SF 3366

as introduced - 80th Legislature (1997 - 1998) Posted on 12/15/2009 12:00am

  1.1                          A bill for an act 
  1.2             relating to the financing and operation of government 
  1.3             in this state; providing property tax reform; making 
  1.4             changes to property rates, levies, notices, hearings, 
  1.5             assessments, exemptions, aids, and credits; providing 
  1.6             bonding and levy authority, and other powers to 
  1.7             certain political subdivisions; making changes to tax 
  1.8             increment financing, regional development, housing, 
  1.9             and economic development provisions; providing for the 
  1.10            taxation of taconite and the distribution of taconite 
  1.11            taxes; amending Minnesota Statutes 1996, sections 
  1.12            124A.03, subdivision 1f; 273.1398, subdivisions 2 and 
  1.13            4; 298.22, subdivision 2; 298.221; 298.2213, 
  1.14            subdivision 4; 298.225, subdivision 1; 298.28, 
  1.15            subdivisions 2, 3, 4, 6, 7, 9, and 10; 298.48, 
  1.16            subdivision 1; 462.396, subdivision 2; 469.174, by 
  1.17            adding a subdivision; 469.175, subdivisions 5, 6, 6a, 
  1.18            and by adding a subdivision; 469.176, subdivision 7; 
  1.19            469.177, by adding a subdivision; 469.1771, 
  1.20            subdivision 5, and by adding a subdivision; 473.39, by 
  1.21            adding a subdivision; 477A.0122, subdivision 6; and 
  1.22            477A.03, subdivision 2; Minnesota Statutes 1997 
  1.23            Supplement, sections 124.239, subdivisions 5, 5a, and 
  1.24            5b; 270.60, subdivision 4; 272.02, subdivision 1; 
  1.25            272.115, subdivisions 4 and 5; 273.112, subdivisions 
  1.26            2, 3, and 4; 273.124, subdivision 14; 273.126, 
  1.27            subdivision 3; 273.127, subdivision 3; 273.13, 
  1.28            subdivisions 22, 23, 24, 25, as amended, and 31; 
  1.29            273.1382, subdivision 1; 275.065, subdivisions 3 and 
  1.30            6; 275.16; 275.70, by adding a subdivision; 287.08; 
  1.31            290B.04, subdivisions 1 and 3; 290B.05, subdivisions 
  1.32            1, 2, and 3; 290B.06; 290B.07; 298.24, subdivision 1; 
  1.33            298.28, subdivisions 9a and 9b; 298.296, subdivision 
  1.34            4; 462A.071, subdivisions 2, 4, and 8; 469.1812, 
  1.35            subdivision 4; and 477A.011, subdivision 36; Laws 
  1.36            1965, chapter 326, section 1, subdivision 5, as 
  1.37            amended; Laws 1971, chapter 773, sections 1, as 
  1.38            amended, and 2, as amended; Laws 1984, chapter 380, 
  1.39            sections 1, as amended, and 2; Laws 1992, chapter 511, 
  1.40            article 2, section 52, as amended; and Laws 1997, 
  1.41            chapter 231, article 2, section 68, subdivisions 1 and 
  1.42            3; proposing coding for new law in Minnesota Statutes, 
  1.43            chapters 290B; and 298; repealing Minnesota Statutes 
  1.44            1996, sections 298.012; 298.21; 298.23; 298.34, 
  1.45            subdivisions 1 and 4; and 298.391, subdivisions 2 and 
  1.46            5; Minnesota Statutes 1997 Supplement, sections 
  2.1             273.13, subdivision 32; 275.70; 275.71; 275.72; 
  2.2             275.73; and 275.74; Laws 1997, chapter 231, article 3, 
  2.3             section 8. 
  2.4   BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA: 
  2.5                              ARTICLE 1
  2.6                         PROPERTY TAX REFORM
  2.7      Section 1.  Minnesota Statutes 1997 Supplement, section 
  2.8   124.239, subdivision 5, is amended to read: 
  2.9      Subd. 5.  [LEVY AUTHORIZED.] A district, after local board 
  2.10  approval, may levy for costs related to an approved facility 
  2.11  plan as follows:  
  2.12     (a) if the district has indicated to the commissioner that 
  2.13  bonds will be issued, the district may levy for the principal 
  2.14  and interest payments on outstanding bonds issued according to 
  2.15  subdivision 3 after reduction for any alternative facilities aid 
  2.16  receivable under subdivision 5a; or 
  2.17     (b) if the district has indicated to the commissioner that 
  2.18  the plan will be funded through levy, the district may levy 
  2.19  according to the schedule approved in the plan after reduction 
  2.20  for any alternative facilities aid receivable under subdivision 
  2.21  5a. 
  2.22     Sec. 2.  Minnesota Statutes 1997 Supplement, section 
  2.23  124.239, subdivision 5a, is amended to read: 
  2.24     Subd. 5a.  [ALTERNATIVE FACILITIES AID.] A district's 
  2.25  alternative facilities aid is the amount equal to the district's 
  2.26  annual debt service costs, provided that the amount does not 
  2.27  exceed the amount certified to be levied for those purposes for 
  2.28  taxes payable in 1997 plus, for districts with adjusted net tax 
  2.29  capacity per actual pupil unit of less than $2,800, an amount 
  2.30  equal to the district's gross levy authority under subdivision 
  2.31  5, clause (b), before reduction by debt service equalization aid 
  2.32  under section 124.95 for taxes payable in 1998. 
  2.33     Sec. 3.  Minnesota Statutes 1997 Supplement, section 
  2.34  124.239, subdivision 5b, is amended to read: 
  2.35     Subd. 5b.  [ALTERNATIVE FACILITIES APPROPRIATION.] (a) An 
  2.36  amount not to exceed $17,000,000 $22,129,000 is appropriated 
  2.37  from the general fund to the commissioner of children, families, 
  3.1   and learning for fiscal year 2000 and not to exceed $22,698,000 
  3.2   for fiscal year 2001 and each year thereafter for payment of 
  3.3   alternative facilities aid under subdivision 5a.  The 2000 
  3.4   appropriation includes $1,700,000 for 1999 
  3.5   and $15,300,000 $20,429,000 for 2000. 
  3.6      (b) The appropriation in paragraph (a) must be reduced by 
  3.7   the amount of any money specifically appropriated for the same 
  3.8   purpose in any year from any state fund. 
  3.9      Sec. 4.  Minnesota Statutes 1996, section 124A.03, 
  3.10  subdivision 1f, is amended to read: 
  3.11     Subd. 1f.  [REFERENDUM EQUALIZATION REVENUE.] A district's 
  3.12  referendum equalization revenue equals $315 $385 times the 
  3.13  district's actual pupil units for that year. 
  3.14     Referendum equalization revenue must not exceed a 
  3.15  district's total referendum revenue for that year. 
  3.16     Sec. 5.  Minnesota Statutes 1997 Supplement, section 
  3.17  273.127, subdivision 3, is amended to read: 
  3.18     Subd. 3.  [CLASS 4C PROPERTIES.] For the market value of 
  3.19  properties that meet the criteria of subdivision 2, paragraph 
  3.20  (a), and which no longer qualify as a result of the eligibility 
  3.21  criteria specified in section 273.126, a class rate of 2.4 
  3.22  percent applies for taxes payable in 1999 and a class rate of 
  3.23  2.6 2.5 percent applies for taxes payable in 2000. 
  3.24     Sec. 6.  Minnesota Statutes 1997 Supplement, section 
  3.25  273.13, subdivision 22, is amended to read: 
  3.26     Subd. 22.  [CLASS 1.] (a) Except as provided in subdivision 
  3.27  23, real estate which is residential and used for homestead 
  3.28  purposes is class 1.  The market value of class 1a property must 
  3.29  be determined based upon the value of the house, garage, and 
  3.30  land.  
  3.31     For taxes payable in 1998 and thereafter, The first $75,000 
  3.32  of market value of class 1a property has a net class rate of one 
  3.33  percent of its market value; and the market value of class 1a 
  3.34  property that exceeds $75,000 has a class rate of 1.85 1.7 
  3.35  percent of its market value for taxes payable in 1999, and 1.6 
  3.36  percent of its market value for taxes payable in 2000 and 
  4.1   thereafter.  
  4.2      (b) Class 1b property includes homestead real estate or 
  4.3   homestead manufactured homes used for the purposes of a 
  4.4   homestead by 
  4.5      (1) any blind person, or the blind person and the blind 
  4.6   person's spouse; or 
  4.7      (2) any person, hereinafter referred to as "veteran," who: 
  4.8      (i) served in the active military or naval service of the 
  4.9   United States; and 
  4.10     (ii) is entitled to compensation under the laws and 
  4.11  regulations of the United States for permanent and total 
  4.12  service-connected disability due to the loss, or loss of use, by 
  4.13  reason of amputation, ankylosis, progressive muscular 
  4.14  dystrophies, or paralysis, of both lower extremities, such as to 
  4.15  preclude motion without the aid of braces, crutches, canes, or a 
  4.16  wheelchair; and 
  4.17     (iii) has acquired a special housing unit with special 
  4.18  fixtures or movable facilities made necessary by the nature of 
  4.19  the veteran's disability, or the surviving spouse of the 
  4.20  deceased veteran for as long as the surviving spouse retains the 
  4.21  special housing unit as a homestead; or 
  4.22     (3) any person who: 
  4.23     (i) is permanently and totally disabled and 
  4.24     (ii) receives 90 percent or more of total income from 
  4.25     (A) aid from any state as a result of that disability; or 
  4.26     (B) supplemental security income for the disabled; or 
  4.27     (C) workers' compensation based on a finding of total and 
  4.28  permanent disability; or 
  4.29     (D) social security disability, including the amount of a 
  4.30  disability insurance benefit which is converted to an old age 
  4.31  insurance benefit and any subsequent cost of living increases; 
  4.32  or 
  4.33     (E) aid under the federal Railroad Retirement Act of 1937, 
  4.34  United States Code Annotated, title 45, section 228b(a)5; or 
  4.35     (F) a pension from any local government retirement fund 
  4.36  located in the state of Minnesota as a result of that 
  5.1   disability; or 
  5.2      (G) pension, annuity, or other income paid as a result of 
  5.3   that disability from a private pension or disability plan, 
  5.4   including employer, employee, union, and insurance plans and 
  5.5      (iii) has household income as defined in section 290A.03, 
  5.6   subdivision 5, of $50,000 or less; or 
  5.7      (4) any person who is permanently and totally disabled and 
  5.8   whose household income as defined in section 290A.03, 
  5.9   subdivision 5, is 275 percent or less of the federal poverty 
  5.10  level. 
  5.11     Property is classified and assessed under clause (4) only 
  5.12  if the government agency or income-providing source certifies, 
  5.13  upon the request of the homestead occupant, that the homestead 
  5.14  occupant satisfies the disability requirements of this paragraph.
  5.15     Property is classified and assessed pursuant to clause (1) 
  5.16  only if the commissioner of economic security certifies to the 
  5.17  assessor that the homestead occupant satisfies the requirements 
  5.18  of this paragraph.  
  5.19     Permanently and totally disabled for the purpose of this 
  5.20  subdivision means a condition which is permanent in nature and 
  5.21  totally incapacitates the person from working at an occupation 
  5.22  which brings the person an income.  The first $32,000 market 
  5.23  value of class 1b property has a net class rate of .45 percent 
  5.24  of its market value.  The remaining market value of class 1b 
  5.25  property has a net class rate using the rates for class 1 or 
  5.26  class 2a property, whichever is appropriate, of similar market 
  5.27  value.  
  5.28     (c) Class 1c property is commercial use real property that 
  5.29  abuts a lakeshore line and is devoted to temporary and seasonal 
  5.30  residential occupancy for recreational purposes but not devoted 
  5.31  to commercial purposes for more than 250 days in the year 
  5.32  preceding the year of assessment, and that includes a portion 
  5.33  used as a homestead by the owner, which includes a dwelling 
  5.34  occupied as a homestead by a shareholder of a corporation that 
  5.35  owns the resort or a partner in a partnership that owns the 
  5.36  resort, even if the title to the homestead is held by the 
  6.1   corporation or partnership.  For purposes of this clause, 
  6.2   property is devoted to a commercial purpose on a specific day if 
  6.3   any portion of the property, excluding the portion used 
  6.4   exclusively as a homestead, is used for residential occupancy 
  6.5   and a fee is charged for residential occupancy.  In order for a 
  6.6   property to be classified as class 1c, at least 40 percent of 
  6.7   the annual gross lodging receipts related to the property must 
  6.8   be from business conducted between Memorial Day weekend and 
  6.9   Labor Day weekend during any three consecutive calendar months, 
  6.10  and at least 60 percent of all paid reservations or paid 
  6.11  bookings by lodging guests during the year must be for periods 
  6.12  of at least two consecutive nights.  Class 1c property has a 
  6.13  class rate of one percent of total market value with the 
  6.14  following limitation:  the area of the property must not exceed 
  6.15  100 feet of lakeshore footage for each cabin or campsite located 
  6.16  on the property up to a total of 800 feet and 500 feet in depth, 
  6.17  measured away from the lakeshore.  
  6.18     (d) Class 1d property includes structures that meet all of 
  6.19  the following criteria: 
  6.20     (1) the structure is located on property that is classified 
  6.21  as agricultural property under section 273.13, subdivision 23; 
  6.22     (2) the structure is occupied exclusively by seasonal farm 
  6.23  workers during the time when they work on that farm, and the 
  6.24  occupants are not charged rent for the privilege of occupying 
  6.25  the property, provided that use of the structure for storage of 
  6.26  farm equipment and produce does not disqualify the property from 
  6.27  classification under this paragraph; 
  6.28     (3) the structure meets all applicable health and safety 
  6.29  requirements for the appropriate season; and 
  6.30     (4) the structure is not saleable as residential property 
  6.31  because it does not comply with local ordinances relating to 
  6.32  location in relation to streets or roads. 
  6.33     The market value of class 1d property has the same class 
  6.34  rates as class 1a property under paragraph (a). 
  6.35     Sec. 7.  Minnesota Statutes 1997 Supplement, section 
  6.36  273.13, subdivision 23, is amended to read: 
  7.1      Subd. 23.  [CLASS 2.] (a) Class 2a property is agricultural 
  7.2   land including any improvements that is homesteaded.  The market 
  7.3   value of the house and garage and immediately surrounding one 
  7.4   acre of land has the same class rates as class 1a property under 
  7.5   subdivision 22.  The value of the remaining land including 
  7.6   improvements up to $115,000 has a net class rate of 0.4 0.37 
  7.7   percent of market value for taxes payable in 1999 and 0.35 
  7.8   percent of market value for taxes payable in 2000 and 
  7.9   thereafter.  The remaining value of class 2a property over 
  7.10  $115,000 of market value that does not exceed 320 acres has a 
  7.11  net class rate of 0.9 0.85 percent of market value for taxes 
  7.12  payable in 1999 and 0.8 percent of market value for taxes 
  7.13  payable in 2000 and thereafter.  The remaining property over the 
  7.14  $115,000 market value in excess of 320 acres has a class rate of 
  7.15  1.4 1.25 percent of market value for taxes payable in 1999 and 
  7.16  1.15 percent of market value for taxes payable in 2000 and 
  7.17  thereafter.  
  7.18     (b) Class 2b property is (1) real estate, rural in 
  7.19  character and used exclusively for growing trees for timber, 
  7.20  lumber, and wood and wood products; (2) real estate that is not 
  7.21  improved with a structure and is used exclusively for growing 
  7.22  trees for timber, lumber, and wood and wood products, if the 
  7.23  owner has participated or is participating in a cost-sharing 
  7.24  program for afforestation, reforestation, or timber stand 
  7.25  improvement on that particular property, administered or 
  7.26  coordinated by the commissioner of natural resources; (3) real 
  7.27  estate that is nonhomestead agricultural land; or (4) a landing 
  7.28  area or public access area of a privately owned public use 
  7.29  airport.  Class 2b property that is nonhomestead agricultural 
  7.30  land has a net class rate of 1.4 1.25 percent of market 
  7.31  value for taxes payable in 1999 and 1.15 percent of market value 
  7.32  for taxes payable in 2000 and thereafter.  The remainder of 
  7.33  class 2b has a net class rate of 1.35 percent of market value 
  7.34  for taxes payable in 1999 and 1.25 percent of market value for 
  7.35  taxes payable in 2000 and thereafter. 
  7.36     (c) Agricultural land as used in this section means 
  8.1   contiguous acreage of ten acres or more, used during the 
  8.2   preceding year for agricultural purposes.  "Agricultural 
  8.3   purposes" as used in this section means the raising or 
  8.4   cultivation of agricultural products or enrollment in the 
  8.5   Reinvest in Minnesota program under sections 103F.501 to 
  8.6   103F.535 or the federal Conservation Reserve Program as 
  8.7   contained in Public Law Number 99-198.  Contiguous acreage on 
  8.8   the same parcel, or contiguous acreage on an immediately 
  8.9   adjacent parcel under the same ownership, may also qualify as 
  8.10  agricultural land, but only if it is pasture, timber, waste, 
  8.11  unusable wild land, or land included in state or federal farm 
  8.12  programs.  Agricultural classification for property shall be 
  8.13  determined excluding the house, garage, and immediately 
  8.14  surrounding one acre of land, and shall not be based upon the 
  8.15  market value of any residential structures on the parcel or 
  8.16  contiguous parcels under the same ownership. 
  8.17     (d) Real estate, excluding the house, garage, and 
  8.18  immediately surrounding one acre of land, of less than ten acres 
  8.19  which is exclusively and intensively used for raising or 
  8.20  cultivating agricultural products, shall be considered as 
  8.21  agricultural land.  
  8.22     Land shall be classified as agricultural even if all or a 
  8.23  portion of the agricultural use of that property is the leasing 
  8.24  to, or use by another person for agricultural purposes. 
  8.25     Classification under this subdivision is not determinative 
  8.26  for qualifying under section 273.111. 
  8.27     The property classification under this section supersedes, 
  8.28  for property tax purposes only, any locally administered 
  8.29  agricultural policies or land use restrictions that define 
  8.30  minimum or maximum farm acreage. 
  8.31     (e) The term "agricultural products" as used in this 
  8.32  subdivision includes production for sale of:  
  8.33     (1) livestock, dairy animals, dairy products, poultry and 
  8.34  poultry products, fur-bearing animals, horticultural and nursery 
  8.35  stock described in sections 18.44 to 18.61, fruit of all kinds, 
  8.36  vegetables, forage, grains, bees, and apiary products by the 
  9.1   owner; 
  9.2      (2) fish bred for sale and consumption if the fish breeding 
  9.3   occurs on land zoned for agricultural use; 
  9.4      (3) the commercial boarding of horses if the boarding is 
  9.5   done in conjunction with raising or cultivating agricultural 
  9.6   products as defined in clause (1); 
  9.7      (4) property which is owned and operated by nonprofit 
  9.8   organizations used for equestrian activities, excluding racing; 
  9.9   and 
  9.10     (5) game birds and waterfowl bred and raised for use on a 
  9.11  shooting preserve licensed under section 97A.115.  
  9.12     (f) If a parcel used for agricultural purposes is also used 
  9.13  for commercial or industrial purposes, including but not limited 
  9.14  to:  
  9.15     (1) wholesale and retail sales; 
  9.16     (2) processing of raw agricultural products or other goods; 
  9.17     (3) warehousing or storage of processed goods; and 
  9.18     (4) office facilities for the support of the activities 
  9.19  enumerated in clauses (1), (2), and (3), 
  9.20  the assessor shall classify the part of the parcel used for 
  9.21  agricultural purposes as class 1b, 2a, or 2b, whichever is 
  9.22  appropriate, and the remainder in the class appropriate to its 
  9.23  use.  The grading, sorting, and packaging of raw agricultural 
  9.24  products for first sale is considered an agricultural purpose.  
  9.25  A greenhouse or other building where horticultural or nursery 
  9.26  products are grown that is also used for the conduct of retail 
  9.27  sales must be classified as agricultural if it is primarily used 
  9.28  for the growing of horticultural or nursery products from seed, 
  9.29  cuttings, or roots and occasionally as a showroom for the retail 
  9.30  sale of those products.  Use of a greenhouse or building only 
  9.31  for the display of already grown horticultural or nursery 
  9.32  products does not qualify as an agricultural purpose.  
  9.33     The assessor shall determine and list separately on the 
  9.34  records the market value of the homestead dwelling and the one 
  9.35  acre of land on which that dwelling is located.  If any farm 
  9.36  buildings or structures are located on this homesteaded acre of 
 10.1   land, their market value shall not be included in this separate 
 10.2   determination.  
 10.3      (g) To qualify for classification under paragraph (b), 
 10.4   clause (4), a privately owned public use airport must be 
 10.5   licensed as a public airport under section 360.018.  For 
 10.6   purposes of paragraph (b), clause (4), "landing area" means that 
 10.7   part of a privately owned public use airport properly cleared, 
 10.8   regularly maintained, and made available to the public for use 
 10.9   by aircraft and includes runways, taxiways, aprons, and sites 
 10.10  upon which are situated landing or navigational aids.  A landing 
 10.11  area also includes land underlying both the primary surface and 
 10.12  the approach surfaces that comply with all of the following:  
 10.13     (i) the land is properly cleared and regularly maintained 
 10.14  for the primary purposes of the landing, taking off, and taxiing 
 10.15  of aircraft; but that portion of the land that contains 
 10.16  facilities for servicing, repair, or maintenance of aircraft is 
 10.17  not included as a landing area; 
 10.18     (ii) the land is part of the airport property; and 
 10.19     (iii) the land is not used for commercial or residential 
 10.20  purposes. 
 10.21  The land contained in a landing area under paragraph (b), clause 
 10.22  (4), must be described and certified by the commissioner of 
 10.23  transportation.  The certification is effective until it is 
 10.24  modified, or until the airport or landing area no longer meets 
 10.25  the requirements of paragraph (b), clause (4).  For purposes of 
 10.26  paragraph (b), clause (4), "public access area" means property 
 10.27  used as an aircraft parking ramp, apron, or storage hangar, or 
 10.28  an arrival and departure building in connection with the airport.
 10.29     Sec. 8.  Minnesota Statutes 1997 Supplement, section 
 10.30  273.13, subdivision 24, is amended to read: 
 10.31     Subd. 24.  [CLASS 3.] (a) Commercial and industrial 
 10.32  property and utility real and personal property, except class 5 
 10.33  property as identified in subdivision 31, clause (1), is class 
 10.34  3a.  Each parcel has a class rate of 2.7 2.6 percent for taxes 
 10.35  payable in 1999 and 2.5 percent for taxes payable in 2000 and 
 10.36  thereafter of the first tier of market value, and 4.0 3.65 
 11.1   percent for taxes payable in 1999 and 3.5 percent for taxes 
 11.2   payable in 2000 and thereafter of the remaining market value, 
 11.3   except that in the case of contiguous parcels of commercial and 
 11.4   industrial property owned by the same person or entity, only the 
 11.5   value equal to the first-tier value of the contiguous parcels 
 11.6   qualifies for the reduced class rate.  For the purposes of this 
 11.7   subdivision, the first tier means the first $150,000 of market 
 11.8   value.  In the case of utility property owned by one person or 
 11.9   entity, only one parcel in each county has a reduced class rate 
 11.10  on the first tier of market value. 
 11.11     For purposes of this paragraph, parcels are considered to 
 11.12  be contiguous even if they are separated from each other by a 
 11.13  road, street, vacant lot, waterway, or other similar intervening 
 11.14  type of property. 
 11.15     (b) Employment property defined in section 469.166, during 
 11.16  the period provided in section 469.170, shall constitute class 
 11.17  3b and has a class rate of 2.3 percent of the first $50,000 of 
 11.18  market value and 3.6 percent for taxes payable in 1999 and 3.5 
 11.19  percent for taxes payable in 2000 and thereafter of the 
 11.20  remainder, except that for employment property located in a 
 11.21  border city enterprise zone designated pursuant to section 
 11.22  469.168, subdivision 4, paragraph (c), the class rate of the 
 11.23  first tier of market value and the class rate of the remainder 
 11.24  is determined under paragraph (a), unless the governing body of 
 11.25  the city designated as an enterprise zone determines that a 
 11.26  specific parcel shall be assessed pursuant to the first clause 
 11.27  of this sentence.  The governing body may provide for assessment 
 11.28  under the first clause of the preceding sentence only for 
 11.29  property which is located in an area which has been designated 
 11.30  by the governing body for the receipt of tax reductions 
 11.31  authorized by section 469.171, subdivision 1. 
 11.32     (c) Structures which are (i) located on property classified 
 11.33  as class 3a, (ii) constructed under an initial building permit 
 11.34  issued after January 2, 1996, (iii) located in a transit zone as 
 11.35  defined under section 473.3915, subdivision 3, (iv) located 
 11.36  within the boundaries of a school district, and (v) not 
 12.1   primarily used for retail or transient lodging purposes, shall 
 12.2   have a class rate equal to 85 percent of the class rate of the 
 12.3   second tier of the commercial property rate under paragraph (a) 
 12.4   on any portion of the market value that does not qualify for the 
 12.5   first tier class rate under paragraph (a).  As used in item (v), 
 12.6   a structure is primarily used for retail or transient lodging 
 12.7   purposes if over 50 percent of its square footage is used for 
 12.8   those purposes.  The four percent rate A class rate equal to 85 
 12.9   percent of the class rate of the second tier of the commercial 
 12.10  property rate under paragraph (a) shall also apply to 
 12.11  improvements to existing structures that meet the requirements 
 12.12  of items (i) to (v) if the improvements are constructed under an 
 12.13  initial building permit issued after January 2, 1996, even if 
 12.14  the remainder of the structure was constructed prior to January 
 12.15  2, 1996.  For the purposes of this paragraph, a structure shall 
 12.16  be considered to be located in a transit zone if any portion of 
 12.17  the structure lies within the zone.  If any property once 
 12.18  eligible for treatment under this paragraph ceases to remain 
 12.19  eligible due to revisions in transit zone boundaries, the 
 12.20  property shall continue to receive treatment under this 
 12.21  paragraph for a period of three years. 
 12.22     Sec. 9.  Minnesota Statutes 1997 Supplement, section 
 12.23  273.13, subdivision 25, as amended by Laws 1997, Third Special 
 12.24  Session chapter 3, section 28, is amended to read: 
 12.25     Subd. 25.  [CLASS 4.] (a) Class 4a is residential real 
 12.26  estate containing four or more units and used or held for use by 
 12.27  the owner or by the tenants or lessees of the owner as a 
 12.28  residence for rental periods of 30 days or more.  Class 4a also 
 12.29  includes hospitals licensed under sections 144.50 to 144.56, 
 12.30  other than hospitals exempt under section 272.02, and contiguous 
 12.31  property used for hospital purposes, without regard to whether 
 12.32  the property has been platted or subdivided.  Class 4a property 
 12.33  in a city with a population of 5,000 or less, that is (1) 
 12.34  located outside of the metropolitan area, as defined in section 
 12.35  473.121, subdivision 2, or outside any county contiguous to the 
 12.36  metropolitan area, and (2) whose city boundary is at least 15 
 13.1   miles from the boundary of any city with a population greater 
 13.2   than 5,000 has a class rate of 2.3 2.25 percent of market value 
 13.3   for taxes payable in 1999 and 2.15 percent of market value for 
 13.4   taxes payable in 2000 and thereafter.  All other class 4a 
 13.5   property has a class rate of 2.9 2.65 percent of market 
 13.6   value for taxes payable in 1999 and 2.5 percent of market value 
 13.7   for taxes payable in 2000 and thereafter.  For purposes of this 
 13.8   paragraph, population has the same meaning given in section 
 13.9   477A.011, subdivision 3. 
 13.10     (b) Class 4b includes: 
 13.11     (1) residential real estate containing less than four units 
 13.12  that does not qualify as class 4bb, other than seasonal 
 13.13  residential, and recreational; 
 13.14     (2) manufactured homes not classified under any other 
 13.15  provision; 
 13.16     (3) a dwelling, garage, and surrounding one acre of 
 13.17  property on a nonhomestead farm classified under subdivision 23, 
 13.18  paragraph (b) containing two or three units; 
 13.19     (4) unimproved property that is classified residential as 
 13.20  determined under section 273.13, subdivision 33.  
 13.21     Class 4b property has a class rate of 2.1 1.8 percent of 
 13.22  market value.  
 13.23     (c) Class 4bb includes: 
 13.24     (1) nonhomestead residential real estate containing one 
 13.25  unit, other than seasonal residential, and recreational; and 
 13.26     (2) a single family dwelling, garage, and surrounding one 
 13.27  acre of property on a nonhomestead farm classified under 
 13.28  subdivision 23, paragraph (b). 
 13.29     Class 4bb has a class rate of 1.9 1.5 percent for taxes 
 13.30  payable in 1999 and 1.25 percent for taxes payable in 2000 and 
 13.31  thereafter on the first $75,000 of market value and a class rate 
 13.32  of 2.1 1.7 percent for taxes payable in 1999 and 1.6 percent for 
 13.33  taxes payable in 2000 and thereafter of its market value that 
 13.34  exceeds $75,000. 
 13.35     Property that has been classified as seasonal recreational 
 13.36  residential property at any time during which it has been owned 
 14.1   by the current owner or spouse of the current owner does not 
 14.2   qualify for class 4bb. 
 14.3      (d) Class 4c property includes: 
 14.4      (1) except as provided in subdivision 22, paragraph (c), 
 14.5   real property devoted to temporary and seasonal residential 
 14.6   occupancy for recreation purposes, including real property 
 14.7   devoted to temporary and seasonal residential occupancy for 
 14.8   recreation purposes and not devoted to commercial purposes for 
 14.9   more than 250 days in the year preceding the year of 
 14.10  assessment.  For purposes of this clause, property is devoted to 
 14.11  a commercial purpose on a specific day if any portion of the 
 14.12  property is used for residential occupancy, and a fee is charged 
 14.13  for residential occupancy.  In order for a property to be 
 14.14  classified as class 4c, seasonal recreational residential for 
 14.15  commercial purposes, at least 40 percent of the annual gross 
 14.16  lodging receipts related to the property must be from business 
 14.17  conducted between Memorial Day weekend and Labor Day 
 14.18  weekend during three consecutive calendar months and at least 60 
 14.19  percent of all paid reservations or paid bookings by lodging 
 14.20  guests during the year must be for periods of at least two 
 14.21  consecutive nights.  Class 4c also includes commercial use real 
 14.22  property used exclusively for recreational purposes in 
 14.23  conjunction with class 4c property devoted to temporary and 
 14.24  seasonal residential occupancy for recreational purposes, up to 
 14.25  a total of two acres, provided the property is not devoted to 
 14.26  commercial recreational use for more than 250 days in the year 
 14.27  preceding the year of assessment and is located within two miles 
 14.28  of the class 4c property with which it is used.  Class 4c 
 14.29  property classified in this clause also includes the remainder 
 14.30  of class 1c resorts.  Owners of real property devoted to 
 14.31  temporary and seasonal residential occupancy for recreation 
 14.32  purposes and all or a portion of which was devoted to commercial 
 14.33  purposes for not more than 250 days in the year preceding the 
 14.34  year of assessment desiring classification as class 1c or 4c, 
 14.35  must submit a declaration to the assessor designating the cabins 
 14.36  or units occupied for 250 days or less in the year preceding the 
 15.1   year of assessment by January 15 of the assessment year.  Those 
 15.2   cabins or units and a proportionate share of the land on which 
 15.3   they are located will be designated class 1c or 4c as otherwise 
 15.4   provided.  The remainder of the cabins or units and a 
 15.5   proportionate share of the land on which they are located will 
 15.6   be designated as class 3a.  The owner of property desiring 
 15.7   designation as class 1c or 4c property must provide guest 
 15.8   registers or other records demonstrating that the units for 
 15.9   which class 1c or 4c designation is sought were not occupied for 
 15.10  more than 250 days in the year preceding the assessment if so 
 15.11  requested.  The portion of a property operated as a (1) 
 15.12  restaurant, (2) bar, (3) gift shop, and (4) other nonresidential 
 15.13  facility operated on a commercial basis not directly related to 
 15.14  temporary and seasonal residential occupancy for recreation 
 15.15  purposes shall not qualify for class 1c or 4c; 
 15.16     (2) qualified property used as a golf course if: 
 15.17     (i) any portion of the property is located within a county 
 15.18  that has a population of less than 50,000, or within a county 
 15.19  containing a golf course owned by a municipality, the county, or 
 15.20  a special taxing district; 
 15.21     (ii) it is open to the public on a daily fee basis.  It may 
 15.22  charge membership fees or dues, but a membership fee may not be 
 15.23  required in order to use the property for golfing, and its green 
 15.24  fees for golfing must be comparable to green fees typically 
 15.25  charged by municipal courses; and 
 15.26     (iii) it meets the requirements of section 273.112, 
 15.27  subdivision 3, paragraph (d). 
 15.28     A structure used as a clubhouse, restaurant, or place of 
 15.29  refreshment in conjunction with the golf course is classified as 
 15.30  class 3a property. 
 15.31     (3) real property up to a maximum of one acre of land owned 
 15.32  by a nonprofit community service oriented organization; provided 
 15.33  that the property is not used for a revenue-producing activity 
 15.34  for more than six days in the calendar year preceding the year 
 15.35  of assessment and the property is not used for residential 
 15.36  purposes on either a temporary or permanent basis.  For purposes 
 16.1   of this clause, a "nonprofit community service oriented 
 16.2   organization" means any corporation, society, association, 
 16.3   foundation, or institution organized and operated exclusively 
 16.4   for charitable, religious, fraternal, civic, or educational 
 16.5   purposes, and which is exempt from federal income taxation 
 16.6   pursuant to section 501(c)(3), (10), or (19) of the Internal 
 16.7   Revenue Code of 1986, as amended through December 31, 1990.  For 
 16.8   purposes of this clause, "revenue-producing activities" shall 
 16.9   include but not be limited to property or that portion of the 
 16.10  property that is used as an on-sale intoxicating liquor or 3.2 
 16.11  percent malt liquor establishment licensed under chapter 340A, a 
 16.12  restaurant open to the public, bowling alley, a retail store, 
 16.13  gambling conducted by organizations licensed under chapter 349, 
 16.14  an insurance business, or office or other space leased or rented 
 16.15  to a lessee who conducts a for-profit enterprise on the 
 16.16  premises.  Any portion of the property which is used for 
 16.17  revenue-producing activities for more than six days in the 
 16.18  calendar year preceding the year of assessment shall be assessed 
 16.19  as class 3a.  The use of the property for social events open 
 16.20  exclusively to members and their guests for periods of less than 
 16.21  24 hours, when an admission is not charged nor any revenues are 
 16.22  received by the organization shall not be considered a 
 16.23  revenue-producing activity; 
 16.24     (4) post-secondary student housing of not more than one 
 16.25  acre of land that is owned by a nonprofit corporation organized 
 16.26  under chapter 317A and is used exclusively by a student 
 16.27  cooperative, sorority, or fraternity for on-campus housing or 
 16.28  housing located within two miles of the border of a college 
 16.29  campus; and 
 16.30     (5) manufactured home parks as defined in section 327.14, 
 16.31  subdivision 3. 
 16.32     Class 4c property has a class rate of 2.1 1.95 percent of 
 16.33  market value for taxes payable in 1999 and 1.8 percent for taxes 
 16.34  payable in 2000 and thereafter, except that (i) for each parcel 
 16.35  of seasonal residential recreational property not used for 
 16.36  commercial purposes the first $75,000 of market value has a 
 17.1   class rate of 1.4 1.35 percent for taxes payable in 1999 and 
 17.2   1.25 percent for taxes payable in 2000 and thereafter, and the 
 17.3   market value that exceeds $75,000 has a class rate of 2.5 2.4 
 17.4   percent for taxes payable in 1999 and 2.2 percent for taxes 
 17.5   payable in 2000 and thereafter, and (ii) manufactured home parks 
 17.6   assessed under clause (5) have a class rate of two percent.  
 17.7      (e) Class 4d property is qualifying low-income rental 
 17.8   housing certified to the assessor by the housing finance agency 
 17.9   under sections 273.126 and 462A.071.  Class 4d includes land in 
 17.10  proportion to the total market value of the building that is 
 17.11  qualifying low-income rental housing.  For all properties 
 17.12  qualifying as class 4d, the market value determined by the 
 17.13  assessor must be based on the normal approach to value using 
 17.14  normal unrestricted rents. 
 17.15     Class 4d property has a class rate of one percent of market 
 17.16  value.  
 17.17     (f) Class 4e property consists of the residential portion 
 17.18  of any structure located within a city that was converted from 
 17.19  nonresidential use to residential use, provided that: 
 17.20     (1) the structure had formerly been used as a warehouse; 
 17.21     (2) the structure was originally constructed prior to 1940; 
 17.22     (3) the conversion was done after December 31, 1995, but 
 17.23  before January 1, 2003; and 
 17.24     (4) the conversion involved an investment of at least 
 17.25  $25,000 per residential unit. 
 17.26     Class 4e property has a class rate of 2.3 percent, provided 
 17.27  that a structure is eligible for class 4e classification only in 
 17.28  the 12 assessment years immediately following the conversion. 
 17.29     Sec. 10.  Minnesota Statutes 1997 Supplement, section 
 17.30  273.13, subdivision 31, is amended to read: 
 17.31     Subd. 31.  [CLASS 5.] Class 5 property includes:  
 17.32     (1) tools, implements, and machinery of an electric 
 17.33  generating, transmission, or distribution system or a pipeline 
 17.34  system transporting or distributing water, gas, crude oil, or 
 17.35  petroleum products or mains and pipes used in the distribution 
 17.36  of steam or hot or chilled water for heating or cooling 
 18.1   buildings, which are fixtures; 
 18.2      (2) unmined iron ore and low-grade iron-bearing formations 
 18.3   as defined in section 273.14; and 
 18.4      (3) all other property not otherwise classified. 
 18.5      Class 5 property has a class rate of 4.0 3.65 percent of 
 18.6   market value for taxes payable in 1998 1999 and 3.5 percent of 
 18.7   market value for taxes payable in 2000 and thereafter. 
 18.8      Sec. 11.  Minnesota Statutes 1997 Supplement, section 
 18.9   273.1382, subdivision 1, is amended to read: 
 18.10     Subdivision 1.  [EDUCATION HOMESTEAD CREDIT.] Each year, 
 18.11  beginning with property taxes payable in 1998, the respective 
 18.12  county auditors shall determine the initial tax rate for each 
 18.13  school district for the general education levy certified under 
 18.14  section 124A.23, subdivision 2 or 3.  That rate plus the school 
 18.15  district's education homestead credit tax rate adjustment under 
 18.16  section 275.08, subdivision 1e, shall be the general education 
 18.17  homestead credit local tax rate for the district.  The auditor 
 18.18  shall then determine a general education homestead credit for 
 18.19  each homestead within the county equal to 32 56 percent for 
 18.20  taxes payable in 1999 and 68 percent for taxes payable in 2000 
 18.21  and thereafter of the general education homestead credit local 
 18.22  tax rate times the net tax capacity of the homestead for the 
 18.23  taxes payable year.  The amount of general education homestead 
 18.24  credit for a homestead may not exceed $225 $270 for taxes 
 18.25  payable in 1999 and $290 for taxes payable in 2000 and 
 18.26  thereafter.  In the case of an agricultural homestead, only the 
 18.27  net tax capacity of the house, garage, and surrounding one acre 
 18.28  of land shall be used in determining the property's education 
 18.29  homestead credit. 
 18.30     Sec. 12.  Minnesota Statutes 1996, section 273.1398, 
 18.31  subdivision 2, is amended to read: 
 18.32     Subd. 2.  [HOMESTEAD AND AGRICULTURAL CREDIT AID.] 
 18.33  Homestead and agricultural credit aid for each unique taxing 
 18.34  jurisdiction equals the product of (1) the homestead and 
 18.35  agricultural credit aid base, and (2) the growth adjustment 
 18.36  factor, plus the net tax capacity adjustment and the fiscal 
 19.1   disparity adjustment.  Beginning with homestead and agricultural 
 19.2   credit aid payable in 2000, each county that receives an amount 
 19.3   in calendar year 2000 under section 477A.0122 as a result of the 
 19.4   appropriation in section 477A.03, subdivision 2, paragraph (c), 
 19.5   clause (3), shall have its homestead and agricultural credit aid 
 19.6   permanently reduced by an equal amount. 
 19.7      Sec. 13.  Minnesota Statutes 1996, section 273.1398, 
 19.8   subdivision 4, is amended to read: 
 19.9      Subd. 4.  [DISPARITY REDUCTION CREDIT.] (a) Beginning with 
 19.10  taxes payable in 1989, class 4a, class 3a, and class 3b property 
 19.11  qualifies for a disparity reduction credit if:  (1) the property 
 19.12  is located in a border city that has an enterprise zone 
 19.13  designated pursuant to section 469.168, subdivision 4; (2) the 
 19.14  property is located in a city with a population greater than 
 19.15  2,500 and less than 35,000 according to the 1980 decennial 
 19.16  census; (3) the city is adjacent to a city in another state or 
 19.17  immediately adjacent to a city adjacent to a city in another 
 19.18  state; and (4) the adjacent city in the other state has a 
 19.19  population of greater than 5,000 and less than 75,000.  
 19.20     (b) The credit is an amount sufficient to reduce (i) the 
 19.21  taxes levied on class 4a property to 2.3 percent of the 
 19.22  property's market value and (ii) the tax on class 3a and class 
 19.23  3b property to 3.3 3.15 percent of market value.  
 19.24     (c) The county auditor shall annually certify the costs of 
 19.25  the credits to the department of revenue.  The department shall 
 19.26  reimburse local governments for the property taxes foregone as 
 19.27  the result of the credits in proportion to their total levies. 
 19.28     Sec. 14.  Minnesota Statutes 1997 Supplement, section 
 19.29  275.16, is amended to read: 
 19.30     275.16 [COUNTY AUDITOR TO FIX AMOUNT OF LEVY.] 
 19.31     If any such municipality shall return to the county auditor 
 19.32  a levy greater than permitted by chapters 124, 124A, 124B, 136C, 
 19.33  and 136D, and sections 275.124 to 275.16, and sections 275.70 to 
 19.34  275.74, such county auditor shall extend only such amount of 
 19.35  taxes as the limitations herein prescribed will permit; 
 19.36  provided, if such levy shall include any levy for the payment of 
 20.1   bonded indebtedness or judgments, such levies for bonded 
 20.2   indebtedness or judgments shall be extended in full, and the 
 20.3   remainder of the levies shall be reduced so that the total 
 20.4   thereof, including levies for bonds and judgments, shall not 
 20.5   exceed such amount as the limitations herein prescribed will 
 20.6   permit.  
 20.7      Sec. 15.  Minnesota Statutes 1996, section 477A.0122, 
 20.8   subdivision 6, is amended to read: 
 20.9      Subd. 6.  [REPORT.] On or before March 15 of the year 
 20.10  following the year in which the distributions under this section 
 20.11  are received, each county shall file with the commissioner of 
 20.12  revenue and commissioner of human services a report on prior 
 20.13  year expenditures for out-of-home placement and family 
 20.14  preservation, including expenditures under this section.  For 
 20.15  the human services programs specified in this section, the 
 20.16  commissioner of revenue and commissioner of human services, in 
 20.17  consultation with representatives of county governments, shall 
 20.18  make a recommendation to the 1999 legislature as to which 
 20.19  current reporting requirements imposed on county governments, if 
 20.20  any, may be eliminated, replaced, or consolidated on the report 
 20.21  established by this section.  For aid payable in calendar year 
 20.22  2000 and thereafter, each county shall provide information on 
 20.23  the amount of state aid, local property tax revenue, and federal 
 20.24  aid expended by that county on the programs specified in this 
 20.25  section using the consolidated financial report recommended by 
 20.26  the commissioner of revenue and commissioner of human services 
 20.27  under this subdivision. 
 20.28     Sec. 16.  Minnesota Statutes 1996, section 477A.03, 
 20.29  subdivision 2, is amended to read: 
 20.30     Subd. 2.  [ANNUAL APPROPRIATION.] (a) A sum sufficient to 
 20.31  discharge the duties imposed by sections 477A.011 to 477A.014 is 
 20.32  annually appropriated from the general fund to the commissioner 
 20.33  of revenue.  For aids payable in 1996 and thereafter, the total 
 20.34  aids paid under sections section 477A.013, subdivision 9, and 
 20.35  477A.0122 are the amounts certified to be paid in the previous 
 20.36  year, adjusted for inflation as provided under subdivision 
 21.1   3.  Aid payments to counties under section 477A.0121 are limited 
 21.2   to $20,265,000 in 1996.  Aid payments to counties under section 
 21.3   477A.0121 are limited to $27,571,625 in 1997.  
 21.4      (b) For aid payable in 1998 and thereafter, the total aids 
 21.5   paid under section 477A.0121 are the amounts certified to be 
 21.6   paid in the previous year, adjusted for inflation as provided 
 21.7   under subdivision 3. 
 21.8      (c) For aid payable in 2000, the total aid payments under 
 21.9   section 477A.0122 are the sum of:  
 21.10     (1) the amounts certified to be paid in the previous year, 
 21.11  adjusted for inflation as provided in subdivision 3; plus 
 21.12     (2) $20,000,000; plus 
 21.13     (3) $10,000,000.  
 21.14     For aid payable in 2001 and thereafter, the total aid 
 21.15  payments under section 477A.0122 are the amounts certified to be 
 21.16  paid in the previous year, adjusted for inflation as provided in 
 21.17  subdivision 3. 
 21.18     Sec. 17.  [EDUCATION LEVY REDUCTION APPROPRIATION.] 
 21.19     In addition to any amount appropriated by other law, 
 21.20  $50,557,000 is appropriated to the commissioner of children, 
 21.21  families, and learning in fiscal year 2000, $64,903,000 in 
 21.22  fiscal year 2001, and $65,873,000 in fiscal year 2002 and 
 21.23  thereafter to fund a reduction in the statewide general 
 21.24  education property tax levy.  The fiscal year 2001 appropriation 
 21.25  includes $5,617,000 for 2000 and $59,286,000 for 2001. 
 21.26     Sec. 18.  [REPEALER.] 
 21.27     Minnesota Statutes 1997 Supplement, sections 273.13, 
 21.28  subdivision 32; 275.70; 275.71; 275.72; 275.73; and 275.74; and 
 21.29  Laws 1997, chapter 231, article 3, section 8, are repealed. 
 21.30     Sec. 19.  [EFFECTIVE DATE.] 
 21.31     Sections 1 to 18 are effective for taxes payable in 1999 
 21.32  and thereafter and for aid payable in fiscal year 2000 and 
 21.33  thereafter. 
 21.34                             ARTICLE 2 
 21.35          PROPERTY TAXES, LOCAL BONDING AND LEVY AUTHORITY
 21.36     Section 1.  Minnesota Statutes 1997 Supplement, section 
 22.1   272.02, subdivision 1, is amended to read: 
 22.2      Subdivision 1.  All property described in this section to 
 22.3   the extent herein limited shall be exempt from taxation: 
 22.4      (1) All public burying grounds. 
 22.5      (2) All public schoolhouses. 
 22.6      (3) All public hospitals. 
 22.7      (4) All academies, colleges, and universities, and all 
 22.8   seminaries of learning. 
 22.9      (5) All churches, church property, and houses of worship. 
 22.10     (6) Institutions of purely public charity except parcels of 
 22.11  property containing structures and the structures described in 
 22.12  section 273.13, subdivision 25, paragraph (c), clauses (1), (2), 
 22.13  and (3), or paragraph (d), other than those that qualify for 
 22.14  exemption under clause (25). 
 22.15     (7) All public property exclusively used for any public 
 22.16  purpose. 
 22.17     (8) Except for the taxable personal property enumerated 
 22.18  below, all personal property and the property described in 
 22.19  section 272.03, subdivision 1, paragraphs (c) and (d), shall be 
 22.20  exempt.  
 22.21     The following personal property shall be taxable:  
 22.22     (a) personal property which is part of an electric 
 22.23  generating, transmission, or distribution system or a pipeline 
 22.24  system transporting or distributing water, gas, crude oil, or 
 22.25  petroleum products or mains and pipes used in the distribution 
 22.26  of steam or hot or chilled water for heating or cooling 
 22.27  buildings and structures; 
 22.28     (b) railroad docks and wharves which are part of the 
 22.29  operating property of a railroad company as defined in section 
 22.30  270.80; 
 22.31     (c) personal property defined in section 272.03, 
 22.32  subdivision 2, clause (3); 
 22.33     (d) leasehold or other personal property interests which 
 22.34  are taxed pursuant to section 272.01, subdivision 2; 273.124, 
 22.35  subdivision 7; or 273.19, subdivision 1; or any other law 
 22.36  providing the property is taxable as if the lessee or user were 
 23.1   the fee owner; 
 23.2      (e) manufactured homes and sectional structures, including 
 23.3   storage sheds, decks, and similar removable improvements 
 23.4   constructed on the site of a manufactured home, sectional 
 23.5   structure, park trailer or travel trailer as provided in section 
 23.6   273.125, subdivision 8, paragraph (f); and 
 23.7      (f) flight property as defined in section 270.071.  
 23.8      (9) Personal property used primarily for the abatement and 
 23.9   control of air, water, or land pollution to the extent that it 
 23.10  is so used, and real property which is used primarily for 
 23.11  abatement and control of air, water, or land pollution as part 
 23.12  of an agricultural operation, as a part of a centralized 
 23.13  treatment and recovery facility operating under a permit issued 
 23.14  by the Minnesota pollution control agency pursuant to chapters 
 23.15  115 and 116 and Minnesota Rules, parts 7001.0500 to 7001.0730, 
 23.16  and 7045.0020 to 7045.1260, as a wastewater treatment facility 
 23.17  and for the treatment, recovery, and stabilization of metals, 
 23.18  oils, chemicals, water, sludges, or inorganic materials from 
 23.19  hazardous industrial wastes, or as part of an electric 
 23.20  generation system.  For purposes of this clause, personal 
 23.21  property includes ponderous machinery and equipment used in a 
 23.22  business or production activity that at common law is considered 
 23.23  real property. 
 23.24     Any taxpayer requesting exemption of all or a portion of 
 23.25  any real property or any equipment or device, or part thereof, 
 23.26  operated primarily for the control or abatement of air or water 
 23.27  pollution shall file an application with the commissioner of 
 23.28  revenue.  The equipment or device shall meet standards, rules, 
 23.29  or criteria prescribed by the Minnesota pollution control 
 23.30  agency, and must be installed or operated in accordance with a 
 23.31  permit or order issued by that agency.  The Minnesota pollution 
 23.32  control agency shall upon request of the commissioner furnish 
 23.33  information or advice to the commissioner.  On determining that 
 23.34  property qualifies for exemption, the commissioner shall issue 
 23.35  an order exempting the property from taxation.  The equipment or 
 23.36  device shall continue to be exempt from taxation as long as the 
 24.1   permit issued by the Minnesota pollution control agency remains 
 24.2   in effect. 
 24.3      (10) Wetlands.  For purposes of this subdivision, 
 24.4   "wetlands" means:  (i) land described in section 103G.005, 
 24.5   subdivision 15a; (ii) land which is mostly under water, produces 
 24.6   little if any income, and has no use except for wildlife or 
 24.7   water conservation purposes, provided it is preserved in its 
 24.8   natural condition and drainage of it would be legal, feasible, 
 24.9   and economically practical for the production of livestock, 
 24.10  dairy animals, poultry, fruit, vegetables, forage and grains, 
 24.11  except wild rice; or (iii) land in a wetland preservation area 
 24.12  under sections 103F.612 to 103F.616.  "Wetlands" under items (i) 
 24.13  and (ii) include adjacent land which is not suitable for 
 24.14  agricultural purposes due to the presence of the wetlands, but 
 24.15  do not include woody swamps containing shrubs or trees, wet 
 24.16  meadows, meandered water, streams, rivers, and floodplains or 
 24.17  river bottoms.  Exemption of wetlands from taxation pursuant to 
 24.18  this section shall not grant the public any additional or 
 24.19  greater right of access to the wetlands or diminish any right of 
 24.20  ownership to the wetlands. 
 24.21     (11) Native prairie.  The commissioner of the department of 
 24.22  natural resources shall determine lands in the state which are 
 24.23  native prairie and shall notify the county assessor of each 
 24.24  county in which the lands are located.  Pasture land used for 
 24.25  livestock grazing purposes shall not be considered native 
 24.26  prairie for the purposes of this clause.  Upon receipt of an 
 24.27  application for the exemption provided in this clause for lands 
 24.28  for which the assessor has no determination from the 
 24.29  commissioner of natural resources, the assessor shall refer the 
 24.30  application to the commissioner of natural resources who shall 
 24.31  determine within 30 days whether the land is native prairie and 
 24.32  notify the county assessor of the decision.  Exemption of native 
 24.33  prairie pursuant to this clause shall not grant the public any 
 24.34  additional or greater right of access to the native prairie or 
 24.35  diminish any right of ownership to it. 
 24.36     (12) Property used in a continuous program to provide 
 25.1   emergency shelter for victims of domestic abuse, provided the 
 25.2   organization that owns and sponsors the shelter is exempt from 
 25.3   federal income taxation pursuant to section 501(c)(3) of the 
 25.4   Internal Revenue Code of 1986, as amended through December 31, 
 25.5   1992, notwithstanding the fact that the sponsoring organization 
 25.6   receives funding under section 8 of the United States Housing 
 25.7   Act of 1937, as amended. 
 25.8      (13) If approved by the governing body of the municipality 
 25.9   in which the property is located, property not exceeding one 
 25.10  acre which is owned and operated by any senior citizen group or 
 25.11  association of groups that in general limits membership to 
 25.12  persons age 55 or older and is organized and operated 
 25.13  exclusively for pleasure, recreation, and other nonprofit 
 25.14  purposes, no part of the net earnings of which inures to the 
 25.15  benefit of any private shareholders; provided the property is 
 25.16  used primarily as a clubhouse, meeting facility, or recreational 
 25.17  facility by the group or association and the property is not 
 25.18  used for residential purposes on either a temporary or permanent 
 25.19  basis. 
 25.20     (14) To the extent provided by section 295.44, real and 
 25.21  personal property used or to be used primarily for the 
 25.22  production of hydroelectric or hydromechanical power on a site 
 25.23  owned by the federal government, the state, or a local 
 25.24  governmental unit which is developed and operated pursuant to 
 25.25  the provisions of section 103G.535. 
 25.26     (15) If approved by the governing body of the municipality 
 25.27  in which the property is located, and if construction is 
 25.28  commenced after June 30, 1983:  
 25.29     (a) a "direct satellite broadcasting facility" operated by 
 25.30  a corporation licensed by the federal communications commission 
 25.31  to provide direct satellite broadcasting services using direct 
 25.32  broadcast satellites operating in the 12-ghz. band; and 
 25.33     (b) a "fixed satellite regional or national program service 
 25.34  facility" operated by a corporation licensed by the federal 
 25.35  communications commission to provide fixed satellite-transmitted 
 25.36  regularly scheduled broadcasting services using satellites 
 26.1   operating in the 6-ghz. band. 
 26.2   An exemption provided by clause (15) shall apply for a period 
 26.3   not to exceed five years.  When the facility no longer qualifies 
 26.4   for exemption, it shall be placed on the assessment rolls as 
 26.5   provided in subdivision 4.  Before approving a tax exemption 
 26.6   pursuant to this paragraph, the governing body of the 
 26.7   municipality shall provide an opportunity to the members of the 
 26.8   county board of commissioners of the county in which the 
 26.9   facility is proposed to be located and the members of the school 
 26.10  board of the school district in which the facility is proposed 
 26.11  to be located to meet with the governing body.  The governing 
 26.12  body shall present to the members of those boards its estimate 
 26.13  of the fiscal impact of the proposed property tax exemption.  
 26.14  The tax exemption shall not be approved by the governing body 
 26.15  until the county board of commissioners has presented its 
 26.16  written comment on the proposal to the governing body or 30 days 
 26.17  have passed from the date of the transmittal by the governing 
 26.18  body to the board of the information on the fiscal impact, 
 26.19  whichever occurs first. 
 26.20     (16) Real and personal property owned and operated by a 
 26.21  private, nonprofit corporation exempt from federal income 
 26.22  taxation pursuant to United States Code, title 26, section 
 26.23  501(c)(3), primarily used in the generation and distribution of 
 26.24  hot water for heating buildings and structures.  
 26.25     (17) Notwithstanding section 273.19, state lands that are 
 26.26  leased from the department of natural resources under section 
 26.27  92.46. 
 26.28     (18) Electric power distribution lines and their 
 26.29  attachments and appurtenances, that are used primarily for 
 26.30  supplying electricity to farmers at retail.  
 26.31     (19) Transitional housing facilities.  "Transitional 
 26.32  housing facility" means a facility that meets the following 
 26.33  requirements.  (i) It provides temporary housing to individuals, 
 26.34  couples, or families.  (ii) It has the purpose of reuniting 
 26.35  families and enabling parents or individuals to obtain 
 26.36  self-sufficiency, advance their education, get job training, or 
 27.1   become employed in jobs that provide a living wage.  (iii) It 
 27.2   provides support services such as child care, work readiness 
 27.3   training, and career development counseling; and a 
 27.4   self-sufficiency program with periodic monitoring of each 
 27.5   resident's progress in completing the program's goals.  (iv) It 
 27.6   provides services to a resident of the facility for at least 
 27.7   three months but no longer than three years, except residents 
 27.8   enrolled in an educational or vocational institution or job 
 27.9   training program.  These residents may receive services during 
 27.10  the time they are enrolled but in no event longer than four 
 27.11  years.  (v) It is owned and operated or under lease from a unit 
 27.12  of government or governmental agency under a property 
 27.13  disposition program and operated by one or more organizations 
 27.14  exempt from federal income tax under section 501(c)(3) of the 
 27.15  Internal Revenue Code of 1986, as amended through December 31, 
 27.16  1992.  This exemption applies notwithstanding the fact that the 
 27.17  sponsoring organization receives financing by a direct federal 
 27.18  loan or federally insured loan or a loan made by the Minnesota 
 27.19  housing finance agency under the provisions of either Title II 
 27.20  of the National Housing Act or the Minnesota housing finance 
 27.21  agency law of 1971 or rules promulgated by the agency pursuant 
 27.22  to it, and notwithstanding the fact that the sponsoring 
 27.23  organization receives funding under Section 8 of the United 
 27.24  States Housing Act of 1937, as amended. 
 27.25     (20) Real and personal property, including leasehold or 
 27.26  other personal property interests, owned and operated by a 
 27.27  corporation if more than 50 percent of the total voting power of 
 27.28  the stock of the corporation is owned collectively by:  (i) the 
 27.29  board of regents of the University of Minnesota, (ii) the 
 27.30  University of Minnesota Foundation, an organization exempt from 
 27.31  federal income taxation under section 501(c)(3) of the Internal 
 27.32  Revenue Code of 1986, as amended through December 31, 1992, and 
 27.33  (iii) a corporation organized under chapter 317A, which by its 
 27.34  articles of incorporation is prohibited from providing pecuniary 
 27.35  gain to any person or entity other than the regents of the 
 27.36  University of Minnesota; which property is used primarily to 
 28.1   manage or provide goods, services, or facilities utilizing or 
 28.2   relating to large-scale advanced scientific computing resources 
 28.3   to the regents of the University of Minnesota and others. 
 28.4      (21)(a) Small scale wind energy conversion systems 
 28.5   installed after January 1, 1991, and used as an electric power 
 28.6   source are exempt. 
 28.7      "Small scale wind energy conversion systems" are wind 
 28.8   energy conversion systems, as defined in section 216C.06, 
 28.9   subdivision 12, including the foundation or support pad, which 
 28.10  are (i) used as an electric power source; (ii) located within 
 28.11  one county and owned by the same owner; and (iii) produce two 
 28.12  megawatts or less of electricity as measured by nameplate 
 28.13  ratings. 
 28.14     (b) Medium scale wind energy conversion systems installed 
 28.15  after January 1, 1991, are treated as follows:  (i) the 
 28.16  foundation and support pad are taxable; (ii) the associated 
 28.17  supporting and protective structures are exempt for the first 
 28.18  five assessment years after they have been constructed, and 
 28.19  thereafter, 30 percent of the market value of the associated 
 28.20  supporting and protective structures are taxable; and (iii) the 
 28.21  turbines, blades, transformers, and its related equipment, are 
 28.22  exempt.  "Medium scale wind energy conversion systems" are wind 
 28.23  energy conversion systems as defined in section 216C.06, 
 28.24  subdivision 12, including the foundation or support pad, which 
 28.25  are:  (i) used as an electric power source; (ii) located within 
 28.26  one county and owned by the same owner; and (iii) produce more 
 28.27  than two but equal to or less than 12 megawatts of energy as 
 28.28  measured by nameplate ratings. 
 28.29     (c) Large scale wind energy conversion systems installed 
 28.30  after January 1, 1991, are treated as follows:  25 percent of 
 28.31  the market value of all property is taxable, including (i) the 
 28.32  foundation and support pad; (ii) the associated supporting and 
 28.33  protective structures; and (iii) the turbines, blades, 
 28.34  transformers, and its related equipment.  "Large scale wind 
 28.35  energy conversion systems" are wind energy conversion systems as 
 28.36  defined in section 216C.06, subdivision 12, including the 
 29.1   foundation or support pad, which are:  (i) used as an electric 
 29.2   power source; and (ii) produce more than 12 megawatts of energy 
 29.3   as measured by nameplate ratings. 
 29.4      (22) Containment tanks, cache basins, and that portion of 
 29.5   the structure needed for the containment facility used to 
 29.6   confine agricultural chemicals as defined in section 18D.01, 
 29.7   subdivision 3, as required by the commissioner of agriculture 
 29.8   under chapter 18B or 18C. 
 29.9      (23) Photovoltaic devices, as defined in section 216C.06, 
 29.10  subdivision 13, installed after January 1, 1992, and used to 
 29.11  produce or store electric power. 
 29.12     (24) Real and personal property owned and operated by a 
 29.13  private, nonprofit corporation exempt from federal income 
 29.14  taxation pursuant to United States Code, title 26, section 
 29.15  501(c)(3), primarily used for an ice arena or ice rink, and used 
 29.16  primarily for youth and high school programs. 
 29.17     (25) A structure that is situated on real property that is 
 29.18  used for: 
 29.19     (i) housing for the elderly or for low- and moderate-income 
 29.20  families as defined in Title II of the National Housing Act, as 
 29.21  amended through December 31, 1990, and funded by a direct 
 29.22  federal loan or federally insured loan made pursuant to Title II 
 29.23  of the act; or 
 29.24     (ii) housing lower income families or elderly or 
 29.25  handicapped persons, as defined in Section 8 of the United 
 29.26  States Housing Act of 1937, as amended. 
 29.27     In order for a structure to be exempt under (i) or (ii), it 
 29.28  must also meet each of the following criteria: 
 29.29     (A) is owned by an entity which is operated as a nonprofit 
 29.30  corporation organized under chapter 317A; 
 29.31     (B) is owned by an entity which has not entered into a 
 29.32  housing assistance payments contract under Section 8 of the 
 29.33  United States Housing Act of 1937, or, if the entity which owns 
 29.34  the structure has entered into a housing assistance payments 
 29.35  contract under Section 8 of the United States Housing Act of 
 29.36  1937, the contract provides assistance for less than 90 percent 
 30.1   of the dwelling units in the structure, excluding dwelling units 
 30.2   intended for management or maintenance personnel; 
 30.3      (C) operates an on-site congregate dining program in which 
 30.4   participation by residents is mandatory, and provides assisted 
 30.5   living or similar social and physical support services for 
 30.6   residents; and 
 30.7      (D) was not assessed and did not pay tax under chapter 273 
 30.8   prior to the 1991 levy, while meeting the other conditions of 
 30.9   this clause. 
 30.10     An exemption under this clause remains in effect for taxes 
 30.11  levied in each year or partial year of the term of its permanent 
 30.12  financing. 
 30.13     (26) Real and personal property that is located in the 
 30.14  Superior National Forest, and owned or leased and operated by a 
 30.15  nonprofit organization that is exempt from federal income 
 30.16  taxation under section 501(c)(3) of the Internal Revenue Code of 
 30.17  1986, as amended through December 31, 1992, and primarily used 
 30.18  to provide recreational opportunities for disabled veterans and 
 30.19  their families. 
 30.20     (27) Manure pits and appurtenances, which may include 
 30.21  slatted floors and pipes, installed or operated in accordance 
 30.22  with a permit, order, or certificate of compliance issued by the 
 30.23  Minnesota pollution control agency.  The exemption shall 
 30.24  continue for as long as the permit, order, or certificate issued 
 30.25  by the Minnesota pollution control agency remains in effect. 
 30.26     (28) Notwithstanding clause (8), item (a), attached 
 30.27  machinery and other personal property which is part of a 
 30.28  facility containing a cogeneration system as described in 
 30.29  section 216B.166, subdivision 2, paragraph (a), if the 
 30.30  cogeneration system has met the following criteria:  (i) the 
 30.31  system utilizes natural gas as a primary fuel and the 
 30.32  cogenerated steam initially replaces steam generated from 
 30.33  existing thermal boilers utilizing coal; (ii) the facility 
 30.34  developer is selected as a result of a procurement process 
 30.35  ordered by the public utilities commission; and (iii) 
 30.36  construction of the facility is commenced after July 1, 1994, 
 31.1   and before July 1, 1997. 
 31.2      (29) Real property acquired by a home rule charter city, 
 31.3   statutory city, county, town, or school district under a lease 
 31.4   purchase agreement or an installment purchase contract during 
 31.5   the term of the lease purchase agreement as long as and to the 
 31.6   extent that the property is used by the city, county, town, or 
 31.7   school district and devoted to a public use and to the extent it 
 31.8   is not subleased to any private individual, entity, association, 
 31.9   or corporation in connection with a business or enterprise 
 31.10  operated for profit. 
 31.11     (30) Property owned by a nonprofit charitable organization 
 31.12  that qualifies for tax exemption under section 501(c)(3) of the 
 31.13  Internal Revenue Code of 1986, as amended through December 31, 
 31.14  1997, that is intended to be used as a business incubator in a 
 31.15  high-unemployment county but is not occupied on the assessment 
 31.16  date.  As used in this clause, a "business incubator" is a 
 31.17  facility used for the development of nonretail businesses, 
 31.18  offering access to equipment, space, services, and advice to the 
 31.19  tenant businesses, for the purpose of encouraging economic 
 31.20  development, diversification, and job creation in the area 
 31.21  served by the organization, and "high-unemployment county" is a 
 31.22  county that had an average annual unemployment rate of 7.9 
 31.23  percent or greater in 1997.  Property that qualifies for the 
 31.24  exemption under this clause is limited to no more than two 
 31.25  contiguous parcels and structures that do not exceed in the 
 31.26  aggregate 40,000 square feet. 
 31.27     Sec. 2.  Minnesota Statutes 1997 Supplement, section 
 31.28  272.115, subdivision 4, is amended to read: 
 31.29     Subd. 4.  [ELIGIBILITY FOR HOMESTEAD STATUS.] No real 
 31.30  estate sold or transferred on or after January 1, 1993, for 
 31.31  which a certificate of real estate value is required under 
 31.32  subdivision 1 this section shall be classified as a homestead, 
 31.33  unless (1) a certificate of value has been filed with the county 
 31.34  auditor in accordance with this section, or (2) the real estate 
 31.35  was conveyed by the federal government, the state, a political 
 31.36  subdivision of the state, or combination of them to a person 
 32.1   otherwise eligible to receive homestead classification of the 
 32.2   property. 
 32.3      This subdivision shall apply to any real estate taxes that 
 32.4   are payable the year or years following the sale or transfer of 
 32.5   the property. 
 32.6      Sec. 3.  Minnesota Statutes 1997 Supplement, section 
 32.7   272.115, subdivision 5, is amended to read: 
 32.8      Subd. 5.  [EXEMPTION FOR GOVERNMENT BODIES.] A certificate 
 32.9   of real estate value is not required when the real estate is 
 32.10  being conveyed to or by a public authority or agency of the 
 32.11  federal government, the state of Minnesota, a political 
 32.12  subdivision of the state, or any combination of them, for 
 32.13  highway or roadway right-of-way purposes, provided that the 
 32.14  authority, agency, or governmental unit has agreed to file a 
 32.15  list of the real estate conveyed by or to the authority, agency, 
 32.16  or governmental unit with the commissioner of revenue by June 1 
 32.17  of the year following the year of the conveyance. 
 32.18     Sec. 4.  Minnesota Statutes 1997 Supplement, section 
 32.19  273.112, subdivision 2, is amended to read: 
 32.20     Subd. 2.  The present general system of ad valorem property 
 32.21  taxation in the state of Minnesota does not provide an equitable 
 32.22  basis for the taxation of certain private outdoor 
 32.23  recreational, social, open space and park land property and has 
 32.24  resulted in excessive taxes on some of these lands.  Therefore, 
 32.25  it is hereby declared that the public policy of this state would 
 32.26  be best served by equalizing tax burdens upon private, outdoor 
 32.27  recreational, social, open space and park land within this state 
 32.28  through appropriate taxing measures to encourage private 
 32.29  development of these lands which would otherwise not occur or 
 32.30  have to be provided by governmental authority.  
 32.31     Sec. 5.  Minnesota Statutes 1997 Supplement, section 
 32.32  273.112, subdivision 3, is amended to read: 
 32.33     Subd. 3.  Real estate shall be entitled to valuation and 
 32.34  tax deferment under this section only if it is: 
 32.35     (a) actively and exclusively devoted to golf, skiing, lawn 
 32.36  bowling, croquet, or archery or firearms range recreational use 
 33.1   or other recreational or social uses carried on at the 
 33.2   establishment; 
 33.3      (b) five acres in size or more, except in the case of a 
 33.4   lawn bowling or croquet green or an archery or firearms range or 
 33.5   an establishment actively and exclusively devoted to indoor 
 33.6   fitness, health, social, recreational, and related uses in which 
 33.7   the establishment is owned and operated by a not-for-profit 
 33.8   corporation; 
 33.9      (c)(1) operated by private individuals or, in the case of a 
 33.10  lawn bowling or croquet green, by private individuals or 
 33.11  corporations, and open to the public; or 
 33.12     (2) operated by firms or corporations for the benefit of 
 33.13  employees or guests; or 
 33.14     (3) operated by private clubs having a membership of 50 or 
 33.15  more or open to the public, provided that the club does not 
 33.16  discriminate in membership requirements or selection on the 
 33.17  basis of sex or marital status; and 
 33.18     (d) made available for use without discrimination on the 
 33.19  basis of sex during the time when the facility is open to use by 
 33.20  the public or by members, except that use for golf may be 
 33.21  restricted on the basis of sex no more frequently than one, or 
 33.22  part of one, weekend each calendar month for each sex and no 
 33.23  more than two, or part of two, weekdays each week for each sex.  
 33.24     If a golf club membership allows use of golf course 
 33.25  facilities by more than one adult per membership, the use must 
 33.26  be equally available to all adults entitled to use of the golf 
 33.27  course under the membership, except that use may be restricted 
 33.28  on the basis of sex as permitted in this section.  Memberships 
 33.29  that permit play during restricted times may be allowed only if 
 33.30  the restricted times apply to all adults using the membership.  
 33.31  A golf club may not offer a membership or golfing privileges to 
 33.32  a spouse of a member that provides greater or less access to the 
 33.33  golf course than is provided to that person's spouse under the 
 33.34  same or a separate membership in that club, except that the 
 33.35  terms of a membership may provide that one spouse may have no 
 33.36  right to use the golf course at any time while the other spouse 
 34.1   may have either limited or unlimited access to the golf course.  
 34.2      A golf club may have or create an individual membership 
 34.3   category which entitles a member for a reduced rate to play 
 34.4   during restricted hours as established by the club.  The club 
 34.5   must have on record a written request by the member for such 
 34.6   membership.  
 34.7      A golf club that has food or beverage facilities or 
 34.8   services must allow equal access to those facilities and 
 34.9   services for both men and women members in all membership 
 34.10  categories at all times.  Nothing in this paragraph shall be 
 34.11  construed to require service or access to facilities to persons 
 34.12  under the age of 21 years or require any act that would violate 
 34.13  law or ordinance regarding sale, consumption, or regulation of 
 34.14  alcoholic beverages. 
 34.15     For purposes of this subdivision and subdivision 7a, 
 34.16  discrimination means a pattern or course of conduct and not 
 34.17  linked to an isolated incident. 
 34.18     Sec. 6.  Minnesota Statutes 1997 Supplement, section 
 34.19  273.112, subdivision 4, is amended to read: 
 34.20     Subd. 4.  The value of any real estate described in 
 34.21  subdivision 3 shall upon timely application by the owner, in the 
 34.22  manner provided in subdivision 6, be determined solely with 
 34.23  reference to its appropriate private, outdoor 
 34.24  recreational, social, open space and park land classification 
 34.25  and value notwithstanding sections 272.03, subdivision 8, and 
 34.26  273.11.  In determining such value for ad valorem tax purposes 
 34.27  the assessor shall not consider the value such real estate would 
 34.28  have if it were converted to commercial, industrial, residential 
 34.29  or seasonal residential use. 
 34.30     Sec. 7.  Minnesota Statutes 1997 Supplement, section 
 34.31  273.124, subdivision 14, is amended to read: 
 34.32     Subd. 14.  [AGRICULTURAL HOMESTEADS; SPECIAL PROVISIONS.] 
 34.33  (a) Real estate of less than ten acres that is the homestead of 
 34.34  its owner must be classified as class 2a under section 273.13, 
 34.35  subdivision 23, paragraph (a), if:  
 34.36     (1) the parcel on which the house is located is contiguous 
 35.1   on at least two sides to (i) agricultural land, (ii) land owned 
 35.2   or administered by the United States Fish and Wildlife Service, 
 35.3   or (iii) land administered by the department of natural 
 35.4   resources on which in lieu taxes are paid under sections 477A.11 
 35.5   to 477A.14; 
 35.6      (2) its owner also owns a noncontiguous parcel of 
 35.7   agricultural land that is at least 20 acres; 
 35.8      (3) the noncontiguous land is located not farther than two 
 35.9   townships or cities, or a combination of townships or cities 
 35.10  from the homestead; and 
 35.11     (4) the agricultural use value of the noncontiguous land 
 35.12  and farm buildings is equal to at least 50 percent of the market 
 35.13  value of the house, garage, and one acre of land. 
 35.14     Homesteads initially classified as class 2a under the 
 35.15  provisions of this paragraph shall remain classified as class 
 35.16  2a, irrespective of subsequent changes in the use of adjoining 
 35.17  properties, as long as the homestead remains under the same 
 35.18  ownership, the owner owns a noncontiguous parcel of agricultural 
 35.19  land that is at least 20 acres, and the agricultural use value 
 35.20  qualifies under clause (4). 
 35.21     (b) Except as provided in paragraph (d), noncontiguous land 
 35.22  shall be included as part of a homestead under section 273.13, 
 35.23  subdivision 23, paragraph (a), only if the homestead is 
 35.24  classified as class 2a and the detached land is located in the 
 35.25  same township or city, or not farther than two townships or 
 35.26  cities or combination thereof from the homestead.  
 35.27     (c) Agricultural land used for purposes of a homestead and 
 35.28  actively farmed by a person holding a vested remainder interest 
 35.29  in it must be classified as a homestead under section 273.13, 
 35.30  subdivision 23, paragraph (a).  If agricultural land is 
 35.31  classified class 2a, any other dwellings on the land used for 
 35.32  purposes of a homestead by persons holding vested remainder 
 35.33  interests who are actively engaged in farming the property, and 
 35.34  up to one acre of the land surrounding each homestead and 
 35.35  reasonably necessary for the use of the dwelling as a home, must 
 35.36  also be assessed class 2a. 
 36.1      (d) Agricultural land and buildings that were class 2a 
 36.2   homestead property under section 273.13, subdivision 23, 
 36.3   paragraph (a), for the 1997 assessment shall remain classified 
 36.4   as agricultural homesteads for subsequent assessments if:  
 36.5      (1) the property owner abandoned the homestead dwelling 
 36.6   located on the agricultural homestead as a result of the April 
 36.7   1997 floods; 
 36.8      (2) the property is located in the county of Polk, Clay, 
 36.9   Kittson, Marshall, Norman, or Wilkin; 
 36.10     (3) the agricultural land and buildings remain under the 
 36.11  same ownership for the current assessment year as existed for 
 36.12  the 1997 assessment year and continue to be used for 
 36.13  agricultural purposes; 
 36.14     (4) the dwelling occupied by the owner is located in 
 36.15  Minnesota and is within 30 miles of one of the parcels of 
 36.16  agricultural land that is owned by the taxpayer; and 
 36.17     (5) the owner notifies the county assessor that the 
 36.18  relocation was due to the 1997 floods, and the owner furnishes 
 36.19  the assessor any information deemed necessary by the assessor in 
 36.20  verifying the change in homestead dwelling.  For taxes payable 
 36.21  in 1998, the owner must notify the assessor by December 1, 
 36.22  1997.  For taxes payable in 1999 and later years, additional 
 36.23  notifications to the assessor are not required if the property 
 36.24  continues to meet the requirements of this paragraph. 
 36.25     Sec. 8.  Minnesota Statutes 1997 Supplement, section 
 36.26  273.126, subdivision 3, is amended to read: 
 36.27     Subd. 3.  [RENT RESTRICTIONS.] (a) In order to qualify 
 36.28  under class 4d, a unit must be subject to a rent restriction 
 36.29  agreement with the housing finance agency for a period of at 
 36.30  least five years.  The agreement must be in effect and apply to 
 36.31  the rents to be charged for the year in which the property taxes 
 36.32  are payable.  The agreement must provide that the restrictions 
 36.33  apply to each year of the period, regardless of whether the unit 
 36.34  is occupied by an individual with qualifying income or whether 
 36.35  class 4d applies.  The rent restriction agreement must provide 
 36.36  for rents for the unit to be no higher than 30 percent of 60 
 37.1   percent of the median gross income.  The definition of median 
 37.2   gross income specified in this section applies.  "Rent" means 
 37.3   "gross rent" as defined in section 42(g)(2)(B) of the Internal 
 37.4   Revenue Code of 1986, as amended through December 31, 1996.  
 37.5      (b) Notwithstanding the maximum rent levels permitted, 20 
 37.6   percent of the units in the metropolitan area and ten percent of 
 37.7   the units in greater Minnesota qualifying under class 4d must be 
 37.8   made available to a family with a section 8 certificate or 
 37.9   voucher. 
 37.10     (c) The rent restriction agreement runs with the land and 
 37.11  binds any successor to title to the property, without regard to 
 37.12  whether the successor had actual notice or knowledge of the 
 37.13  agreement.  The owner must promptly record the agreement in the 
 37.14  office of the county recorder or must file it in the office of 
 37.15  the registrar of titles, in the county where the property is 
 37.16  located.  If the agreement is not recorded, class 4d does not 
 37.17  apply to the property. 
 37.18     Sec. 9.  Minnesota Statutes 1997 Supplement, section 
 37.19  275.065, subdivision 3, is amended to read: 
 37.20     Subd. 3.  [NOTICE OF PROPOSED PROPERTY TAXES.] (a) The 
 37.21  county auditor shall prepare and the county treasurer shall 
 37.22  deliver after November 10 and on or before November 24 each 
 37.23  year, by first class mail to each taxpayer at the address listed 
 37.24  on the county's current year's assessment roll, a notice of 
 37.25  proposed property taxes.  
 37.26     (b) The commissioner of revenue shall prescribe the form of 
 37.27  the notice. 
 37.28     (c) The notice must inform taxpayers that it contains the 
 37.29  amount of property taxes each taxing authority proposes to 
 37.30  collect for taxes payable the following year.  In the case of a 
 37.31  town, or in the case of the state determined portion of the 
 37.32  school district levy, the final tax amount will be its proposed 
 37.33  tax.  The notice must clearly state that each taxing authority, 
 37.34  including regional library districts established under section 
 37.35  134.201, and including the metropolitan taxing districts as 
 37.36  defined in paragraph (i), but excluding all other special taxing 
 38.1   districts and towns, will hold a public meeting to receive 
 38.2   public testimony on the proposed budget and proposed or final 
 38.3   property tax levy, or, in case of a school district, on the 
 38.4   current budget and proposed property tax levy.  It must clearly 
 38.5   state the time and place of each taxing authority's meeting and 
 38.6   an address where comments will be received by mail.  
 38.7      (d) The notice must state for each parcel: 
 38.8      (1) the market value of the property as determined under 
 38.9   section 273.11, and used for computing property taxes payable in 
 38.10  the following year and for taxes payable in the current year as 
 38.11  each appears in the records of the county assessor on November 1 
 38.12  of the current year; and, in the case of residential property, 
 38.13  whether the property is classified as homestead or 
 38.14  nonhomestead.  The notice must clearly inform taxpayers of the 
 38.15  years to which the market values apply and that the values are 
 38.16  final values; 
 38.17     (2) the items listed below, shown separately by county, 
 38.18  city or town, state determined school tax net of the education 
 38.19  homestead credit under section 273.1382, voter approved school 
 38.20  levy, other local school levy, and the sum of the special taxing 
 38.21  districts, and as a total of all taxing authorities:  
 38.22     (i) the actual tax for taxes payable in the current year; 
 38.23     (ii) the tax change due to spending factors, defined as the 
 38.24  proposed tax minus the constant spending tax amount; 
 38.25     (iii) the tax change due to other factors, defined as the 
 38.26  constant spending tax amount minus the actual current year tax; 
 38.27  and 
 38.28     (iv) the proposed tax amount. 
 38.29     In the case of a town or the state determined school tax, 
 38.30  the final tax shall also be its proposed tax unless the town 
 38.31  changes its levy at a special town meeting under section 
 38.32  365.52.  If a school district has certified under section 
 38.33  124A.03, subdivision 2, that a referendum will be held in the 
 38.34  school district at the November general election, the county 
 38.35  auditor must note next to the school district's proposed amount 
 38.36  that a referendum is pending and that, if approved by the 
 39.1   voters, the tax amount may be higher than shown on the notice.  
 39.2   In the case of the city of Minneapolis, the levy for the 
 39.3   Minneapolis library board and the levy for Minneapolis park and 
 39.4   recreation shall be listed separately from the remaining amount 
 39.5   of the city's levy.  In the case of a parcel where tax increment 
 39.6   or the fiscal disparities areawide tax under chapter 276A or 
 39.7   473F applies, the proposed tax levy on the captured value or the 
 39.8   proposed tax levy on the tax capacity subject to the areawide 
 39.9   tax must each be stated separately and not included in the sum 
 39.10  of the special taxing districts; and 
 39.11     (3) the increase or decrease between the total taxes 
 39.12  payable in the current year and the total proposed taxes, 
 39.13  expressed as a percentage. 
 39.14     For purposes of this section, the amount of the tax on 
 39.15  homesteads qualifying under the senior citizens' property tax 
 39.16  deferral program under chapter 290B is the total amount of 
 39.17  property tax before subtraction of the deferred property tax 
 39.18  amount. 
 39.19     (e) The notice must clearly state that the proposed or 
 39.20  final taxes do not include the following: 
 39.21     (1) special assessments; 
 39.22     (2) levies approved by the voters after the date the 
 39.23  proposed taxes are certified, including bond referenda, school 
 39.24  district levy referenda, and levy limit increase referenda; 
 39.25     (3) amounts necessary to pay cleanup or other costs due to 
 39.26  a natural disaster occurring after the date the proposed taxes 
 39.27  are certified; 
 39.28     (4) amounts necessary to pay tort judgments against the 
 39.29  taxing authority that become final after the date the proposed 
 39.30  taxes are certified; and 
 39.31     (5) the contamination tax imposed on properties which 
 39.32  received market value reductions for contamination. 
 39.33     (f) Except as provided in subdivision 7, failure of the 
 39.34  county auditor to prepare or the county treasurer to deliver the 
 39.35  notice as required in this section does not invalidate the 
 39.36  proposed or final tax levy or the taxes payable pursuant to the 
 40.1   tax levy. 
 40.2      (g) If the notice the taxpayer receives under this section 
 40.3   lists the property as nonhomestead, and satisfactory 
 40.4   documentation is provided to the county assessor by the 
 40.5   applicable deadline, and the property qualifies for the 
 40.6   homestead classification in that assessment year, the assessor 
 40.7   shall reclassify the property to homestead for taxes payable in 
 40.8   the following year. 
 40.9      (h) In the case of class 4 residential property used as a 
 40.10  residence for lease or rental periods of 30 days or more, the 
 40.11  taxpayer must either: 
 40.12     (1) mail or deliver a copy of the notice of proposed 
 40.13  property taxes to each tenant, renter, or lessee; or 
 40.14     (2) post a copy of the notice in a conspicuous place on the 
 40.15  premises of the property.  
 40.16     The notice must be mailed or posted by the taxpayer by 
 40.17  November 27 or within three days of receipt of the notice, 
 40.18  whichever is later.  A taxpayer may notify the county treasurer 
 40.19  of the address of the taxpayer, agent, caretaker, or manager of 
 40.20  the premises to which the notice must be mailed in order to 
 40.21  fulfill the requirements of this paragraph. 
 40.22     (i) For purposes of this subdivision, subdivisions 5a and 
 40.23  6, "metropolitan special taxing districts" means the following 
 40.24  taxing districts in the seven-county metropolitan area that levy 
 40.25  a property tax for any of the specified purposes listed below: 
 40.26     (1) metropolitan council under section 473.132, 473.167, 
 40.27  473.249, 473.325, 473.446, 473.521, 473.547, or 473.834; 
 40.28     (2) metropolitan airports commission under section 473.667, 
 40.29  473.671, or 473.672; and 
 40.30     (3) metropolitan mosquito control commission under section 
 40.31  473.711. 
 40.32     For purposes of this section, any levies made by the 
 40.33  regional rail authorities in the county of Anoka, Carver, 
 40.34  Dakota, Hennepin, Ramsey, Scott, or Washington under chapter 
 40.35  398A shall be included with the appropriate county's levy and 
 40.36  shall be discussed at that county's public hearing. 
 41.1      (j) If a statutory or home rule charter city or a town 
 41.2   exercises the local levy option provided by section 473.388, 
 41.3   subdivision 7, it may include in the notice of its proposed 
 41.4   taxes a statement of the amount by which its proposed taxes are 
 41.5   attributable to its exercise of the option, together with a 
 41.6   statement that the levy of the metropolitan council was 
 41.7   decreased by a similar amount because of exercise of that option.
 41.8      Sec. 10.  Minnesota Statutes 1997 Supplement, section 
 41.9   275.065, subdivision 6, is amended to read: 
 41.10     Subd. 6.  [PUBLIC HEARING; ADOPTION OF BUDGET AND LEVY.] 
 41.11  (a) For purposes of this section, the following terms shall have 
 41.12  the meanings given: 
 41.13     (1) "Initial hearing" means the first and primary hearing 
 41.14  held to discuss the taxing authority's proposed budget and 
 41.15  proposed property tax levy for taxes payable in the following 
 41.16  year, or, for school districts, the current budget and the 
 41.17  proposed property tax levy for taxes payable in the following 
 41.18  year. 
 41.19     (2) "Continuation hearing" means a hearing held to complete 
 41.20  the initial hearing, if the initial hearing is not completed on 
 41.21  its scheduled date. 
 41.22     (3) "Subsequent hearing" means the hearing held to adopt 
 41.23  the taxing authority's final property tax levy, and, in the case 
 41.24  of taxing authorities other than school districts, the final 
 41.25  budget, for taxes payable in the following year. 
 41.26     (b) Between November 29 and December 20, the governing 
 41.27  bodies of a city that has a population over 500, county, 
 41.28  metropolitan special taxing districts as defined in subdivision 
 41.29  3, paragraph (i), and regional library districts shall each hold 
 41.30  an initial public hearing to discuss and seek public comment on 
 41.31  its final budget and property tax levy for taxes payable in the 
 41.32  following year, and the governing body of the school district 
 41.33  shall hold an initial public hearing to review its current 
 41.34  budget and proposed property tax levy for taxes payable in the 
 41.35  following year.  The metropolitan special taxing districts shall 
 41.36  be required to hold only a single joint initial public hearing, 
 42.1   the location of which will be determined by the affected 
 42.2   metropolitan agencies. 
 42.3      (c) The initial hearing must be held after 5:00 p.m. if 
 42.4   scheduled on a day other than Saturday.  No initial hearing may 
 42.5   be held on a Sunday.  
 42.6      (d) At the initial hearing under this subdivision, the 
 42.7   percentage increase in property taxes proposed by the taxing 
 42.8   authority, if any, and the specific purposes for which property 
 42.9   tax revenues are being increased must be discussed.  During the 
 42.10  discussion, the governing body shall hear comments regarding a 
 42.11  proposed increase and explain the reasons for the proposed 
 42.12  increase.  The public shall be allowed to speak and to ask 
 42.13  questions.  At the public hearing, the school district must also 
 42.14  provide and discuss information on the distribution of its 
 42.15  revenues by revenue source, and the distribution of its spending 
 42.16  by program area.  
 42.17     (e) If the initial hearing is not completed on its 
 42.18  scheduled date, the taxing authority must announce, prior to 
 42.19  adjournment of the hearing, the date, time, and place for the 
 42.20  continuation of the hearing.  The continuation hearing must be 
 42.21  held at least five business days but no more than 14 business 
 42.22  days after the initial hearing.  A continuation hearing may not 
 42.23  be held later than December 20 except as provided in paragraphs 
 42.24  (f) and (g).  A continuation hearing must be held after 5:00 
 42.25  p.m. if scheduled on a day other than Saturday.  No continuation 
 42.26  hearing may be held on a Sunday. 
 42.27     (f) The governing body of a county shall hold its initial 
 42.28  hearing on the second Tuesday in December each year, and may 
 42.29  hold additional initial hearings on other dates before December 
 42.30  20 if necessary for the convenience of county residents.  If the 
 42.31  county needs a continuation of its hearing, the continuation 
 42.32  hearing shall be held on the third Tuesday in December.  If the 
 42.33  third Tuesday in December falls on December 21, the county's 
 42.34  continuation hearing shall be held on Monday, December 20.  
 42.35     (g) The metropolitan special taxing districts shall hold a 
 42.36  joint initial public hearing on the first Monday Wednesday of 
 43.1   December.  A continuation hearing, if necessary, shall be held 
 43.2   on the second Monday Wednesday of December even if that second 
 43.3   Monday Wednesday is after December 10. 
 43.4      (h) The county auditor shall provide for the coordination 
 43.5   of initial and continuation hearing dates for all school 
 43.6   districts and cities within the county to prevent conflicts 
 43.7   under clauses (i) and (j). 
 43.8      (i) By August 10, each school board and the board of the 
 43.9   regional library district shall certify to the county auditors 
 43.10  of the counties in which the school district or regional library 
 43.11  district is located the dates on which it elects to hold its 
 43.12  initial hearing and any continuation hearing.  If a school board 
 43.13  or regional library district does not certify these dates by 
 43.14  August 10, the auditor will assign the initial and continuation 
 43.15  hearing dates.  The dates elected or assigned must not conflict 
 43.16  with the initial and continuation hearing dates of the county or 
 43.17  the metropolitan special taxing districts.  
 43.18     (j) By August 20, the county auditor shall notify the 
 43.19  clerks of the cities within the county of the dates on which 
 43.20  school districts and regional library districts have elected to 
 43.21  hold their initial and continuation hearings.  At the time a 
 43.22  city certifies its proposed levy under subdivision 1 it shall 
 43.23  certify the dates on which it elects to hold its initial hearing 
 43.24  and any continuation hearing.  Until September 15, the first and 
 43.25  second Mondays of December are reserved for the use of cities.  
 43.26  If a city does not certify these its hearing dates by September 
 43.27  15, the auditor shall assign the initial and continuation 
 43.28  hearing dates.  The dates elected or assigned for the initial 
 43.29  hearing must not conflict with the initial hearing dates of the 
 43.30  county, metropolitan special taxing districts, regional library 
 43.31  districts, or school districts within which the city is 
 43.32  located.  To the extent possible, the dates of the city's 
 43.33  continuation hearing should not conflict with the continuation 
 43.34  hearing dates of the county, metropolitan special taxing 
 43.35  districts, regional library districts, or school districts 
 43.36  within which the city is located.  This paragraph does not apply 
 44.1   to cities of 500 population or less. 
 44.2      (k) The county initial hearing date and the city, 
 44.3   metropolitan special taxing district, regional library district, 
 44.4   and school district initial hearing dates must be designated on 
 44.5   the notices required under subdivision 3.  The continuation 
 44.6   hearing dates need not be stated on the notices.  
 44.7      (l) At a subsequent hearing, each county, school district, 
 44.8   city over 500 population, and metropolitan special taxing 
 44.9   district may amend its proposed property tax levy and must adopt 
 44.10  a final property tax levy.  Each county, city over 500 
 44.11  population, and metropolitan special taxing district may also 
 44.12  amend its proposed budget and must adopt a final budget at the 
 44.13  subsequent hearing.  The final property tax levy must be adopted 
 44.14  prior to adopting the final budget.  A school district is not 
 44.15  required to adopt its final budget at the subsequent hearing.  
 44.16  The subsequent hearing of a taxing authority must be held on a 
 44.17  date subsequent to the date of the taxing authority's initial 
 44.18  public hearing.  If a continuation hearing is held, the 
 44.19  subsequent hearing must be held either immediately following the 
 44.20  continuation hearing or on a date subsequent to the continuation 
 44.21  hearing.  The subsequent hearing may be held at a regularly 
 44.22  scheduled board or council meeting or at a special meeting 
 44.23  scheduled for the purposes of the subsequent hearing.  The 
 44.24  subsequent hearing of a taxing authority does not have to be 
 44.25  coordinated by the county auditor to prevent a conflict with an 
 44.26  initial hearing, a continuation hearing, or a subsequent hearing 
 44.27  of any other taxing authority.  All subsequent hearings must be 
 44.28  held prior to five working days after December 20 of the levy 
 44.29  year.  The date, time, and place of the subsequent hearing must 
 44.30  be announced at the initial public hearing or at the 
 44.31  continuation hearing. 
 44.32     (m) The property tax levy certified under section 275.07 by 
 44.33  a city of any population, county, metropolitan special taxing 
 44.34  district, regional library district, or school district must not 
 44.35  exceed the proposed levy determined under subdivision 1, except 
 44.36  by an amount up to the sum of the following amounts: 
 45.1      (1) the amount of a school district levy whose voters 
 45.2   approved a referendum to increase taxes under section 124.82, 
 45.3   subdivision 3, 124A.03, subdivision 2, or 124B.03, subdivision 
 45.4   2, after the proposed levy was certified; 
 45.5      (2) the amount of a city or county levy approved by the 
 45.6   voters after the proposed levy was certified; 
 45.7      (3) the amount of a levy to pay principal and interest on 
 45.8   bonds approved by the voters under section 475.58 after the 
 45.9   proposed levy was certified; 
 45.10     (4) the amount of a levy to pay costs due to a natural 
 45.11  disaster occurring after the proposed levy was certified, if 
 45.12  that amount is approved by the commissioner of revenue under 
 45.13  subdivision 6a; 
 45.14     (5) the amount of a levy to pay tort judgments against a 
 45.15  taxing authority that become final after the proposed levy was 
 45.16  certified, if the amount is approved by the commissioner of 
 45.17  revenue under subdivision 6a; 
 45.18     (6) the amount of an increase in levy limits certified to 
 45.19  the taxing authority by the commissioner of children, families, 
 45.20  and learning or the commissioner of revenue after the proposed 
 45.21  levy was certified; and 
 45.22     (7) the amount required under section 124.755. 
 45.23     (n) This subdivision does not apply to towns and special 
 45.24  taxing districts other than regional library districts and 
 45.25  metropolitan special taxing districts. 
 45.26     (o) Notwithstanding the requirements of this section, the 
 45.27  employer is required to meet and negotiate over employee 
 45.28  compensation as provided for in chapter 179A.  
 45.29     Sec. 11.  Minnesota Statutes 1997 Supplement, section 
 45.30  275.70, is amended by adding a subdivision to read: 
 45.31     Subd. 6.  [MATCHING FUND REQUIREMENTS.] The special levy 
 45.32  provided in subdivision 5, clause (8), does not include the 
 45.33  increased direct and indirect costs related to general increases 
 45.34  in program costs where there is no mandated increase regarding 
 45.35  the matching fund requirements.  Specifically, but without 
 45.36  limitation, the following provisions apply to the special levy 
 46.1   authorization in subdivision 5, clause (8):  (1) increases in 
 46.2   direct or indirect income maintenance administrative costs are 
 46.3   not included; (2) increases for social services and social 
 46.4   services administration are included, but only to the extent 
 46.5   that the minimum local share amount needed to receive community 
 46.6   social service aids exceeds the amount levied for social 
 46.7   services and social services administration for the taxes 
 46.8   payable year 1997; and (3) increases in county costs for Title 
 46.9   IV-E Foster Care Services over the amount levied for the taxes 
 46.10  payable year 1997 are included to the extent the amount from 
 46.11  both years represents the local matching fund requirement for 
 46.12  the federal grant.  
 46.13     Sec. 12.  Minnesota Statutes 1997 Supplement, section 
 46.14  287.08, is amended to read: 
 46.15     287.08 [TAX, HOW PAYABLE; RECEIPTS.] 
 46.16     (a) The tax imposed by sections 287.01 to 287.12 shall be 
 46.17  paid to the treasurer of the county in which the mortgaged land 
 46.18  or some part thereof is situated at or before the time of filing 
 46.19  the mortgage for record or registration.  The treasurer shall 
 46.20  endorse receipt on the mortgage, countersigned by the county 
 46.21  auditor, who shall charge the amount to the treasurer and such 
 46.22  receipt shall be recorded with the mortgage, and such receipt of 
 46.23  the record thereof shall be conclusive proof that the tax has 
 46.24  been paid to the amount therein stated and authorize any county 
 46.25  recorder to record the mortgage.  Its form, in substance, shall 
 46.26  be "registration tax hereon of ..................... dollars 
 46.27  paid."  If the mortgages be exempt from taxation the endorsement 
 46.28  shall be "exempt from registration tax," to be signed in either 
 46.29  case by the treasurer as such, and in case of payment to be 
 46.30  countersigned by the auditor.  In case the treasurer shall be 
 46.31  unable to determine whether a claim of exemption should be 
 46.32  allowed, the tax shall be paid as in the case of a taxable 
 46.33  mortgage.  
 46.34     (b) Upon written application of the taxpayer, the county 
 46.35  treasurer may refund in whole or in part any tax which has been 
 46.36  erroneously paid, or a person having paid a mortgage registry 
 47.1   tax amount may seek a refund of such tax, or other appropriate 
 47.2   relief, by bringing an action in tax court in the county in 
 47.3   which the tax was paid, within 60 days of the payment.  The 
 47.4   action is commenced by the serving of a petition for relief on 
 47.5   the county treasurer, and by filing a copy with the court.  The 
 47.6   county attorney shall defend the action.  The county treasurer 
 47.7   shall notify the treasurer of each county that has or would 
 47.8   receive a portion of the tax as paid.  
 47.9      (c) If the county treasurer determines a refund should be 
 47.10  paid, or if a refund is ordered, the county treasurer of each 
 47.11  county that actually received a portion of the tax shall 
 47.12  immediately pay a proportionate share of three percent of the 
 47.13  refund using any available county funds.  The county treasurer 
 47.14  of each county which received, or would have received, a portion 
 47.15  of the tax shall also pay their county's proportionate share of 
 47.16  the remaining 97 percent of the court-ordered refund on or 
 47.17  before the tenth day of the following month using solely the 
 47.18  mortgage registry tax funds that would be paid to the 
 47.19  commissioner of revenue on that date under section 287.12.  If 
 47.20  the funds on hand under this procedure are insufficient to fully 
 47.21  fund 97 percent of the court-ordered refund, the county 
 47.22  treasurer of the county in which the action was brought shall 
 47.23  file a claim with the commissioner of revenue under section 
 47.24  16A.48 for the remaining portion of 97 percent of the refund, 
 47.25  and shall pay over the remaining portion upon receipt of a 
 47.26  warrant from the state issued pursuant to the claim.  
 47.27     (d) When any such mortgage covers real property situate in 
 47.28  more than one county in this state the whole of such tax shall 
 47.29  be paid to the treasurer of the county where the mortgage is 
 47.30  first presented for record or registration, and the payment 
 47.31  shall be receipted and countersigned as above provided.  If the 
 47.32  principal debt or obligation secured by such a multiple county 
 47.33  mortgage exceeds $1,000,000, the tax shall be divided and paid 
 47.34  over by the county treasurer receiving the same, on or before 
 47.35  the tenth day of each month after receipt thereof, to the county 
 47.36  or counties entitled thereto in the ratio which the market value 
 48.1   of the real property covered by the mortgage in each county 
 48.2   bears to the market value of all the property described in the 
 48.3   mortgage.  In making such division and payment the county 
 48.4   treasurer shall send therewith a statement giving the 
 48.5   description of the property described in the mortgage and the 
 48.6   market value of the part thereof situate in each county.  For 
 48.7   the purpose aforesaid, the treasurer of any county may require 
 48.8   the treasurer of any other county to certify to the former the 
 48.9   market valuation of any tract of land in any such mortgage. 
 48.10     Sec. 13.  Minnesota Statutes 1996, section 462.396, 
 48.11  subdivision 2, is amended to read: 
 48.12     Subd. 2.  [BUDGET; HEARING; LEVY LIMITS.] On or before 
 48.13  August 20 each year, the commission shall submit its proposed 
 48.14  budget for the ensuing calendar year showing anticipated 
 48.15  receipts, disbursements and ad valorem tax levy with a written 
 48.16  notice of the time and place of the public hearing on the 
 48.17  proposed budget to each county auditor and municipal clerk 
 48.18  within the region and those town clerks who in advance have 
 48.19  requested a copy of the budget and notice of public hearing.  On 
 48.20  or before September 15 each year, the commission shall adopt, 
 48.21  after a public hearing held not later than September 15, a 
 48.22  budget covering its anticipated receipts and disbursements for 
 48.23  the ensuing year and shall decide upon the total amount 
 48.24  necessary to be raised from ad valorem tax levies to meet its 
 48.25  budget.  After adoption of the budget and no later than 
 48.26  September 15, the secretary of the commission shall certify to 
 48.27  the auditor of each county within the region the county share of 
 48.28  the tax, which shall be an amount bearing the same proportion to 
 48.29  the total levy agreed on by the commission as the net tax 
 48.30  capacity of the county bears to the net tax capacity of the 
 48.31  region.  (1) For taxes levied in 1990 and thereafter 1998, the 
 48.32  maximum amounts of levies made for the purposes of sections 
 48.33  462.381 to 462.398 are the following amounts, less the sum of 
 48.34  regional planning grants from the commissioner to that region:  
 48.35  for Region 1, $180,337; for Region 2, $150,000 $180,000; for 
 48.36  Region 3, $353,110; for Region 5, $195,865; for Region 6E, 
 49.1   $197,177; for Region 6W, $150,000 $180,000; for Region 
 49.2   7E, $158,653 $180,000; for Region 8, $206,107; for Region 9, 
 49.3   $343,572.  (2) For taxes levied in 1999 and thereafter, the 
 49.4   maximum amount that may be levied by each commission shall be 
 49.5   the amount authorized in clause (1), or 103 percent of the 
 49.6   amount levied in the previous year, whichever is greater.  The 
 49.7   auditor of each county in the region shall add the amount of any 
 49.8   levy made by the commission within the limits imposed by this 
 49.9   subdivision to other tax levies of the county for collection by 
 49.10  the county treasurer with other taxes.  When collected the 
 49.11  county treasurer shall make settlement of the taxes with the 
 49.12  commission in the same manner as other taxes are distributed to 
 49.13  political subdivisions. 
 49.14     Sec. 14.  Minnesota Statutes 1997 Supplement, section 
 49.15  462A.071, subdivision 2, is amended to read: 
 49.16     Subd. 2.  [APPLICATION.] (a) In order to qualify for 
 49.17  certification under subdivision 1, the owner or manager of the 
 49.18  property must annually apply to the agency.  The application 
 49.19  must be in the form prescribed by the agency, contain the 
 49.20  information required by the agency, and be submitted by the date 
 49.21  and time specified by the agency. 
 49.22     (b) Each application must include: 
 49.23     (1) the property tax identification number; 
 49.24     (2) the number, type, and size of units the applicant seeks 
 49.25  to qualify as low-income housing under class 4d; 
 49.26     (3) the number, type, and size of units in the property for 
 49.27  which the applicant is not seeking qualification, if any; 
 49.28     (4) a certification that the property has been inspected by 
 49.29  a qualified inspector within the past three years and meets the 
 49.30  minimum housing quality standards or is exempt from the 
 49.31  inspection requirement under subdivision 4; 
 49.32     (5) a statement indicating the building is qualifying units 
 49.33  in compliance with the income limits; 
 49.34     (6) an executed agreement to restrict rents meeting the 
 49.35  requirements specified by the agency or executed leases for the 
 49.36  units for which qualification as low-income housing as class 4d 
 50.1   under section 273.13 is sought and the rent schedule; and 
 50.2      (7) any additional information the agency deems appropriate 
 50.3   to require. 
 50.4      (c) The applicant must pay a per-unit application fee to be 
 50.5   set by the agency.  The application fee charged by the agency 
 50.6   must approximately equal the costs of processing and reviewing 
 50.7   the applications.  The fee must be deposited in the general 
 50.8   housing development fund. 
 50.9      Sec. 15.  Minnesota Statutes 1997 Supplement, section 
 50.10  462A.071, subdivision 4, is amended to read: 
 50.11     Subd. 4.  [MINIMUM HOUSING QUALITY STANDARDS.] (a) To 
 50.12  qualify for taxation under class 4d under section 273.13, a unit 
 50.13  must meet both the housing maintenance code of the local unit of 
 50.14  government in which the unit is located, if such a code has been 
 50.15  adopted, and or the housing quality standards adopted by the 
 50.16  United States Department of Housing and Urban Development, if no 
 50.17  local housing maintenance code has been adopted. 
 50.18     (b) In order to meet the minimum housing quality standards, 
 50.19  a building must be inspected by an independent designated 
 50.20  inspector at least once every three years.  The inspector must 
 50.21  certify that the building complies with the minimum standards.  
 50.22  The property owner must pay the cost of the inspection. 
 50.23     (c) The agency may exempt from the inspection requirement 
 50.24  housing units that are financed by a governmental entity and 
 50.25  subject to regular inspection or other compliance checks with 
 50.26  regard to minimum housing quality.  Written certification must 
 50.27  be supplied to show that these exempt units have been inspected 
 50.28  within the last three years and comply with the requirements 
 50.29  under the public financing or local requirements. 
 50.30     Sec. 16.  Minnesota Statutes 1997 Supplement, section 
 50.31  462A.071, subdivision 8, is amended to read: 
 50.32     Subd. 8.  [PENALTIES.] (a) The penalties provided by this 
 50.33  subdivision apply to each unit that received class 4d taxation 
 50.34  for a year and failed to meet the requirements of section 
 50.35  273.126 and this section. 
 50.36     (b) If the owner or manager does not comply with the rent 
 51.1   restriction agreement, or does not comply with the income 
 51.2   restrictions or, minimum housing quality standards, or the 
 51.3   section 8 availability requirements, a penalty applies equal to 
 51.4   the increased taxes that would have been imposed if the property 
 51.5   unit had not been classified under class 4d for the year in 
 51.6   which restrictions were violated, plus an additional amount 
 51.7   equal to ten percent of the increased taxes.  The provisions of 
 51.8   section 279.03 apply to the amount of increased taxes that would 
 51.9   have been imposed if a unit had not been classified under class 
 51.10  4d for the year in which restrictions were violated. 
 51.11     (c) If the agency finds that the violations were 
 51.12  inadvertent and insubstantial, a penalty of $50 per unit per 
 51.13  year applies in lieu of the penalty specified under paragraph 
 51.14  (b).  In order to qualify under this paragraph, violations of 
 51.15  the minimum housing quality standards must be corrected within a 
 51.16  reasonable period of time and rent charged in excess of the 
 51.17  agreement must be rebated to the tenants. 
 51.18     (d) The agency may abate the penalties under this 
 51.19  subdivision for reasonable cause. 
 51.20     (e) Penalties assessed under paragraph (c) are payable to 
 51.21  the agency and must be deposited in the general housing 
 51.22  development fund.  If an owner or manager fails to timely pay a 
 51.23  penalty imposed under paragraph (c), the agency may choose to: 
 51.24     (1) impose the penalty under paragraph (b); or 
 51.25     (2) certify the penalty under paragraph (c) to the auditor 
 51.26  for collection as additional taxes. 
 51.27  The agency shall certify to the county auditor penalties 
 51.28  assessed under paragraph (b) and clause (2).  The auditor shall 
 51.29  impose and collect the certified penalties as additional taxes 
 51.30  which will be distributed to taxing districts in the same manner 
 51.31  as property taxes on the property. 
 51.32     Sec. 17.  Minnesota Statutes 1996, section 473.39, is 
 51.33  amended by adding a subdivision to read: 
 51.34     Subd. 1e.  [OBLIGATIONS.] In addition to the authority in 
 51.35  subdivisions 1a, 1b, 1c, and 1d, the council may issue 
 51.36  certificates of indebtedness, bonds, or other obligations under 
 52.1   this section in an amount not exceeding $32,500,000, which may 
 52.2   be used for capital expenditures as prescribed in the council's 
 52.3   transit capital improvement program and for related costs, 
 52.4   including the costs of issuance and sale of the obligations. 
 52.5      Sec. 18.  Minnesota Statutes 1997 Supplement, section 
 52.6   477A.011, subdivision 36, is amended to read: 
 52.7      Subd. 36.  [CITY AID BASE.] (a) Except as provided in 
 52.8   paragraphs (b), (c), and (d), "city aid base" means, for each 
 52.9   city, the sum of the local government aid and equalization aid 
 52.10  it was originally certified to receive in calendar year 1993 
 52.11  under Minnesota Statutes 1992, section 477A.013, subdivisions 3 
 52.12  and 5, and the amount of disparity reduction aid it received in 
 52.13  calendar year 1993 under Minnesota Statutes 1992, section 
 52.14  273.1398, subdivision 3. 
 52.15     (b) For aids payable in 1996 and thereafter, a city that in 
 52.16  1992 or 1993 transferred an amount from governmental funds to 
 52.17  its sewer and water fund, which amount exceeded its net levy for 
 52.18  taxes payable in the year in which the transfer occurred, has a 
 52.19  "city aid base" equal to the sum of (i) its city aid base, as 
 52.20  calculated under paragraph (a), and (ii) one-half of the 
 52.21  difference between its city aid distribution under section 
 52.22  477A.013, subdivision 9, for aids payable in 1995 and its city 
 52.23  aid base for aids payable in 1995. 
 52.24     (c) The city aid base for any city with a population less 
 52.25  than 500 is increased by $40,000 for aids payable in calendar 
 52.26  year 1995 and thereafter, and the maximum amount of total aid it 
 52.27  may receive under section 477A.013, subdivision 9, paragraph 
 52.28  (c), is also increased by $40,000 for aids payable in calendar 
 52.29  year 1995 only, provided that: 
 52.30     (i) the average total tax capacity rate for taxes payable 
 52.31  in 1995 exceeds 200 percent; 
 52.32     (ii) the city portion of the tax capacity rate exceeds 100 
 52.33  percent; and 
 52.34     (iii) its city aid base is less than $60 per capita. 
 52.35     (d) The city aid base for a city is increased by $20,000 in 
 52.36  1998 and thereafter and the maximum amount of total aid it may 
 53.1   receive under section 477A.013, subdivision 9, paragraph (c), is 
 53.2   also increased by $20,000 in calendar year 1998 only, provided 
 53.3   that: 
 53.4      (i) the city has a population in 1994 of 2,500 or more; 
 53.5      (ii) the city is located in a county, outside of the 
 53.6   metropolitan area, which contains a city of the first class; 
 53.7      (iii) the city's net tax capacity used in calculating its 
 53.8   1996 aid under section 477A.013 is less than $400 per capita; 
 53.9   and 
 53.10     (iv) at least four percent of the total net tax capacity, 
 53.11  for taxes payable in 1996, of property located in the city is 
 53.12  classified as railroad property. 
 53.13     (e) The city aid base for a city is increased by $200,000 
 53.14  in 1999 and thereafter and the maximum amount of total aid it 
 53.15  may receive under section 477A.013, subdivision 9, paragraph 
 53.16  (c), is also increased by $200,000 in calendar year 1999 only, 
 53.17  provided that: 
 53.18     (i) the city was incorporated as a statutory city after 
 53.19  December 1, 1993; 
 53.20     (ii) its city aid base does not exceed $5,600; and 
 53.21     (iii) the city had a population in 1996 of 5,000 or more. 
 53.22     Sec. 19.  Laws 1971, chapter 773, section 1, subdivision 2, 
 53.23  as amended by Laws 1974, chapter 351, section 5, Laws 1976, 
 53.24  chapter 234, section 7, Laws 1978, chapter 788, section 1, Laws 
 53.25  1981, chapter 369, section 1, Laws 1983, chapter 302, section 1, 
 53.26  Laws 1988, chapter 513, section 1, and Laws 1992, chapter 511, 
 53.27  article 9, section 23, is amended to read: 
 53.28     Subd. 2.  For each of the years through 1998 2003, the city 
 53.29  of St. Paul is authorized to issue bonds in the aggregate 
 53.30  principal amount of $8,000,000 $15,000,000 for each year; or in 
 53.31  an amount equal to one-fourth of one percent of the assessors 
 53.32  estimated market value of taxable property in St. Paul, 
 53.33  whichever is greater, provided that no more than 
 53.34  $8,000,000 $15,000,000 of bonds is authorized to be issued in 
 53.35  any year, unless St. Paul's local general obligation debt as 
 53.36  defined in this section is less than six percent of market value 
 54.1   calculated as of December 31 of the preceding year; but at no 
 54.2   time shall the aggregate principal amount of bonds authorized 
 54.3   exceed $15,700,000 in 1992, $16,600,000 in 1993, $16,600,000 in 
 54.4   1994, $16,600,000 in 1995, $17,500,000 in 1996, $17,500,000 in 
 54.5   1997, and $18,000,000 in 1998, $18,000,000 in 1999, $19,000,000 
 54.6   in 2000, $19,000,000 in 2001, $19,500,000 in 2002, and 
 54.7   $20,000,000 in 2003. 
 54.8      Sec. 20.  Laws 1971, chapter 773, section 1, as amended by 
 54.9   Laws 1974, chapter 351, section 5, subdivision 1, Laws 1976, 
 54.10  chapter 234, section 1, Laws 1978, chapter 788, section 1, Laws 
 54.11  1981, chapter 369, section 1, and Laws 1983, chapter 302, 
 54.12  section 1, is amended to read:  
 54.13     Section 1.  [ST. PAUL, CITY OF; CAPITAL IMPROVEMENT 
 54.14  PROGRAM.] 
 54.15     Subdivision 1.  Notwithstanding any provision of the 
 54.16  charter of the city of St. Paul, the council of said city shall 
 54.17  have power by a resolution adopted by five affirmative votes of 
 54.18  all its members to authorize the issuance and sale of general 
 54.19  obligation bonds of the city in the years stated and in the 
 54.20  aggregate annual amounts not to exceed the limits prescribed in 
 54.21  subdivision 2 of this section for the payment of which the full 
 54.22  faith and credit of the city is irrevocably pledged. 
 54.23     Subd. 2.  For each of the years 1983, 1984, 1985, 1986, 
 54.24  1987, and 1988 the city of St. Paul is authorized to issue bonds 
 54.25  in the aggregate principal amount of $8,000,000 for each year; 
 54.26  or in an amount equal to one-fourth of one percent of the 
 54.27  assessors estimated market value of taxable property in St. 
 54.28  Paul, whichever is greater, provided that no more than 
 54.29  $8,000,000 of bonds is authorized to be issued in any year, 
 54.30  unless St. Paul's local general obligation debt as defined in 
 54.31  this section is less than six percent of market value calculated 
 54.32  as of December 31 of the preceding year; but at no time shall 
 54.33  the aggregate principal amount of bonds authorized exceed 
 54.34  $9,000,000 in 1983, $9,500,000 in 1984, $10,100,000 in 1985, 
 54.35  $10,700,000 in 1986, $11,300,000 in 1987, and $12,000,000 in 
 54.36  1988.  
 55.1      Subd. 3.  For purposes of this section, St. Paul's general 
 55.2   obligation debt shall consist of the principal amount of all 
 55.3   outstanding bonds of (1) the city of St. Paul, the housing and 
 55.4   redevelopment authority of St. Paul, the civic center authority 
 55.5   of St. Paul, and the port authority of St. Paul, for which the 
 55.6   full faith and credit of the city or any of the foregoing 
 55.7   authorities has been pledged; (2) Independent School District 
 55.8   625, for which the full faith and credit of the district has 
 55.9   been pledged; and (3) the county of Ramsey, for which the full 
 55.10  faith and credit of the county has been pledged, reduced by an 
 55.11  amount equal to the principal amount of the outstanding bonds 
 55.12  multiplied by a figure, the numerator of which is equal to the 
 55.13  assessed value net tax capacity of property within the county 
 55.14  outside of the city of St. Paul and the denominator of which is 
 55.15  equal to the assessed value net tax capacity of the county.  
 55.16     There shall be deducted before making the foregoing 
 55.17  computations the outstanding principal amount of all refunded 
 55.18  bonds, all tax or aid anticipation certificates of indebtedness 
 55.19  of the city, the authorities, the school district and the county 
 55.20  for which the full faith and credit of the bodies has been 
 55.21  pledged and all tax increment financed bonds which have not 
 55.22  used, for the prior three consecutive years, general tax levies 
 55.23  or capitalized interest to support annual principal and interest 
 55.24  payments. 
 55.25     Sec. 21.  Laws 1971, chapter 773, section 2, as amended by 
 55.26  Laws 1978, chapter 788, section 2, Laws 1983, chapter 302, 
 55.27  section 2, Laws 1988, chapter 513, section 2, and Laws 1992, 
 55.28  chapter 511, article 9, section 24, is amended to read: 
 55.29     Sec. 2.  The proceeds of all bonds issued pursuant to 
 55.30  section 1 hereof shall be used exclusively for the acquisition, 
 55.31  construction, and repair of capital improvements and, commencing 
 55.32  in the year 1992 and notwithstanding any provision in Laws 1978, 
 55.33  chapter 788, section 5, as amended, for redevelopment project 
 55.34  activities as defined in Minnesota Statutes, section 469.002, 
 55.35  subdivision 14, in accordance with Minnesota Statutes, section 
 55.36  469.041, clause (6).  The amount of proceeds of bonds authorized 
 56.1   by section 1 used for redevelopment project activities shall not 
 56.2   exceed $655,000 in 1992, $690,000 in 1993, $690,000 in 1994, 
 56.3   $690,000 in 1995, $700,000 in 1996, $700,000 in 1997, 
 56.4   and $725,000 in 1998 or any later year. 
 56.5      None of the proceeds of any bonds so issued shall be 
 56.6   expended except upon projects which have been reviewed, and have 
 56.7   received a priority rating, from a capital improvements 
 56.8   committee consisting of 18 members, of whom a majority shall not 
 56.9   hold any paid office or position under the city of St. Paul.  
 56.10  The members shall be appointed by the mayor, with at least four 
 56.11  members from each Minnesota senate district located entirely 
 56.12  within the city and at least two members from each senate 
 56.13  district located partly within the city.  Prior to making an 
 56.14  appointment to a vacancy on the capital improvement budget 
 56.15  committee, the mayor shall consult the legislators of the senate 
 56.16  district in which the vacancy occurs.  The priorities and 
 56.17  recommendations of the committee shall be purely advisory, and 
 56.18  no buyer of any bonds shall be required to see to the 
 56.19  application of the proceeds. 
 56.20     Sec. 22.  Laws 1984, chapter 380, section 1, as amended by 
 56.21  Laws 1994, chapter 505, article 6, section 27, is amended to 
 56.22  read: 
 56.23     Section 1.  [TAX.] 
 56.24     The Anoka county board may levy a tax on of not more than 
 56.25  .01 percent of the taxable market value of taxable 
 56.26  property located within the county outside of excluding any 
 56.27  taxable property taxed by any city in which is situated a for 
 56.28  the support of any free public library, to acquire, better, and 
 56.29  construct county library buildings and to pay principal and 
 56.30  interest on bonds issued for that purpose.  The tax shall be 
 56.31  disregarded in the calculation of levies or limits on levies 
 56.32  provided by Minnesota Statutes, section 373.40, or other law.  
 56.33     Sec. 23.  Laws 1984, chapter 380, section 2, is amended to 
 56.34  read: 
 56.35     Sec. 2.  [AUTHORIZATION.] 
 56.36     The Anoka county board may, by resolution adopted by a 
 57.1   four-sevenths vote, issue and sell general obligation bonds of 
 57.2   the county in the amount of $9,000,000 in the manner provided in 
 57.3   Minnesota Statutes, chapter 475, to acquire, better, and 
 57.4   construct county library buildings.  The total amount of bonds 
 57.5   outstanding at any time shall not exceed $5,000,000.  The county 
 57.6   board, prior to the issuance of any bonds authorized by section 
 57.7   1 and after adopting the resolution as provided above in this 
 57.8   section, shall adopt a resolution by majority vote of the county 
 57.9   board stating the amount, purpose and, in general, the security 
 57.10  to be provided for the bonds, and shall publish the resolution 
 57.11  once each week for two consecutive weeks in the medium of 
 57.12  official and legal publication of the county.  The bonds may be 
 57.13  issued without the submission of the question of their issuance 
 57.14  to the voters of the county library district unless within 21 
 57.15  days after the second publication of the resolution a petition 
 57.16  requesting a referendum, signed by at least ten percent of the 
 57.17  registered voters of the county, is filed with the county 
 57.18  auditor.  If a petition is filed, bonds may be issued unless 
 57.19  disapproved by a majority of the voters of the county library 
 57.20  district, voting on the question of their issuance at a regular 
 57.21  or special election.  The bonds shall not be subject to the 
 57.22  requirements of Minnesota Statutes, sections 475.57 to 475.59.  
 57.23  The maturity years and amounts and interest rates of each series 
 57.24  of bonds shall be fixed so that the maximum amount of principal 
 57.25  and interest to become due in any year, on the bonds of that 
 57.26  series and of all outstanding series issued by or for the 
 57.27  purposes of libraries, shall not exceed an amount equal to 
 57.28  three-fourths of a mill times the assessed value the lesser of 
 57.29  (i) .01 percent of the taxable market value of all taxable 
 57.30  property in the county, which was not excluding any taxable 
 57.31  property taxed in 1981 by any city for the support of any free 
 57.32  public library, as last finally equalized before the issuance of 
 57.33  the series or (ii) $1,250,000.  When the tax levy authorized in 
 57.34  this sections section is collected, it shall be appropriated and 
 57.35  credited to a debt service fund for the bonds.  The tax levy for 
 57.36  the debt service fund under Minnesota Statutes, section 475.61 
 58.1   shall be reduced by the amount available or reasonably 
 58.2   anticipated to be available in the fund to make payments 
 58.3   otherwise payable from the levy pursuant to section 475.61. 
 58.4      Sec. 24.  Laws 1992, chapter 511, article 2, section 52, as 
 58.5   amended by Laws 1997, chapter 231, article 2, section 50, is 
 58.6   amended to read: 
 58.7      Sec. 52.  [WATERSHED DISTRICT LEVIES.] 
 58.8      (a) The Nine Mile Creek watershed district, the 
 58.9   Riley-Purgatory Bluff Creek watershed district, the Minnehaha 
 58.10  Creek watershed district, the Coon Creek watershed district, and 
 58.11  the Lower Minnesota River watershed district may levy in 1992 
 58.12  and thereafter a tax not to exceed $200,000 on property within 
 58.13  the district for the administrative fund.  The levy authorized 
 58.14  under this section is in lieu of Minnesota Statutes, section 
 58.15  103D.905, subdivision 3.  The administrative fund shall be used 
 58.16  for the purposes contained in Minnesota Statutes, section 
 58.17  103D.905, subdivision 3.  The board of managers shall make the 
 58.18  levy for the administrative fund in accordance with Minnesota 
 58.19  Statutes, section 103D.915. 
 58.20     (b) The Wild Rice watershed district may levy, for taxes 
 58.21  payable in 1993, 1994, 1995, 1996, 1997, 1998, 1999, 2000, 2001, 
 58.22  and 2002, an ad valorem tax not to exceed $200,000 on property 
 58.23  within the district for the administrative fund.  The additional 
 58.24  $75,000 above the amount authorized in Minnesota Statutes, 
 58.25  section 103D.905, subdivision 3, must be used for (1) costs 
 58.26  incurred in connection with the development and maintenance of 
 58.27  cost-sharing projects with the United States Army Corps of 
 58.28  Engineers or (2) administrative costs associated with 1997 flood 
 58.29  mitigation projects.  The board of managers shall make the levy 
 58.30  for the administrative fund in accordance with Minnesota 
 58.31  Statutes, section 103D.915. 
 58.32     Sec. 25.  Laws 1997, chapter 231, article 2, section 68, 
 58.33  subdivision 1, is amended to read: 
 58.34     Subdivision 1.  [APPLICATION.] To facilitate a review by 
 58.35  the 1998 legislature of the property taxation of elderly 
 58.36  assisted living facilities and the development of standards and 
 59.1   criteria for the taxation of these facilities, this section: 
 59.2      (1) requires the commissioner of revenue to conduct a 
 59.3   survey of the tax status of these facilities under subdivision 
 59.4   2; and 
 59.5      (2) prohibits changes in assessment practices and policies 
 59.6   regarding these facilities under subdivision 3. 
 59.7      Sec. 26.  Laws 1997, chapter 231, article 2, section 68, 
 59.8   subdivision 3, is amended to read: 
 59.9      Subd. 3.  [MORATORIUM ON CHANGES IN ASSESSMENT PRACTICES.] 
 59.10  (a) An assessor may not change the current practices or policies 
 59.11  used generally in assessing elderly assisted living facilities. 
 59.12     (b) An assessor may not change the assessment of an 
 59.13  existing elderly assisted living facility, unless the change is 
 59.14  made as a result of a change in ownership, occupancy, or use of 
 59.15  the facility.  This paragraph does not apply to: 
 59.16     (1) a facility that was constructed during calendar year 
 59.17  1997 or 1998; 
 59.18     (2) a facility that was converted to an elderly assisted 
 59.19  living facility during calendar year 1997 or 1998; or 
 59.20     (3) a change in market value. 
 59.21     (c) This subdivision expires and no longer applies on the 
 59.22  earlier of: 
 59.23     (1) the enactment of legislation establishing criteria for 
 59.24  the property taxation of elderly assisted living facilities; or 
 59.25     (2) final adjournment of the 1998 1999 legislature. 
 59.26     Sec. 27.  [CHILD CARE FACILITY.] 
 59.27     In connection with the capital expenditure authority in 
 59.28  Minnesota Statutes, section 473.39, subdivision 1e, the 
 59.29  metropolitan council shall consider incorporating in a new 
 59.30  transfer garage a child care facility to assist in the 
 59.31  recruitment and retention of metropolitan transit drivers. 
 59.32     Sec. 28.  [QUALIFIED PROPERTY.] 
 59.33     A contiguous property located within a county adjacent to a 
 59.34  county containing a city of the first class and within the 
 59.35  metropolitan area as defined in Minnesota Statutes, section 
 59.36  473.121, that was valued under Minnesota Statutes, section 
 60.1   273.111, for taxes payable in 1995, shall be valued and 
 60.2   classified under sections 29 and 30 and shall be eligible for 
 60.3   deferral of special assessments under section 31, provided it 
 60.4   meets the following conditions: 
 60.5      (1) the property does not exceed 60 acres; 
 60.6      (2) the property includes a sculpture garden open to the 
 60.7   public; 
 60.8      (3) the property includes a system of internal roads and 
 60.9   paths for pedestrian use and a planned amphitheater for live 
 60.10  artistic performances; 
 60.11     (4) the property is used for a summer youth art camp; 
 60.12     (5) the property is used for seminars for aspiring and 
 60.13  professional artists; 
 60.14     (6) the property includes the homestead of the owner; and 
 60.15     (7) the property has been owned by the owner for at least 
 60.16  40 years. 
 60.17     Sec. 29.  [CLASSIFICATION.] 
 60.18     Notwithstanding any law to the contrary, a property 
 60.19  qualifying under section 28 shall be classified as class 2a 
 60.20  property under Minnesota Statutes, section 273.13, subdivision 
 60.21  23. 
 60.22     Sec. 30.  [VALUATION.] 
 60.23     Notwithstanding Minnesota Statutes, section 273.111, 
 60.24  subdivisions 3 and 6, a property qualifying under section 28 
 60.25  shall be valued solely with reference to its agricultural value 
 60.26  as otherwise provided under Minnesota Statutes, section 273.111. 
 60.27     Sec. 31.  [SPECIAL ASSESSMENT DEFERRAL.] 
 60.28     Notwithstanding Minnesota Statutes, section 273.111, 
 60.29  subdivisions 3 and 6, a property qualifying under section 28 
 60.30  shall be eligible for deferral of both levied and pending 
 60.31  special assessments as otherwise provided under Minnesota 
 60.32  Statutes, section 273.111, subdivision 11.  Nothing in this 
 60.33  section requires the refund of special assessments already paid. 
 60.34     Sec. 32.  [TRANSFER OF PROPERTY; PAYMENT OF DEFERRED TAXES 
 60.35  AND SPECIAL ASSESSMENTS.] 
 60.36     Subdivision 1.  [ADDITIONAL TAX.] The assessor shall make a 
 61.1   separate determination of the market value and net tax capacity 
 61.2   of a property qualifying under section 28 as if sections 29 and 
 61.3   30 did not apply.  The tax based upon the appropriate local tax 
 61.4   rate applicable to such property in the taxing district shall be 
 61.5   recorded on the property assessment records. 
 61.6      Subd. 2.  [RECAPTURE.] (a) Property or any portion thereof 
 61.7   qualifying under section 28 is subject to additional taxes if (1)
 61.8   ownership of the property is transferred to anyone other than 
 61.9   the spouse or child of the current owner, or (2) the current 
 61.10  owner or the spouse or child of the current owner has not 
 61.11  conveyed or entered into a contract to convey the property to a 
 61.12  nonprofit foundation or corporation created to own and operate 
 61.13  the property as an art park providing services included in 
 61.14  section 28, clauses (2) to (5), before July 1, 2002.  
 61.15     (b) The additional taxes are imposed at the earlier of (1) 
 61.16  the year following transfer of ownership to anyone other than 
 61.17  the spouse of the current owner or a nonprofit foundation or 
 61.18  corporation created to own and operate the property as an art 
 61.19  park, or (2) 2003.  The additional taxes are equal to the 
 61.20  difference between the taxes determined under sections 29 and 30 
 61.21  and the amount determined under subdivision 1 for all years that 
 61.22  the property qualified under section 28.  The additional taxes 
 61.23  must be extended against the property on the tax list for the 
 61.24  current year; provided, however, that no interest or penalties 
 61.25  may be levied on the additional taxes if timely paid. 
 61.26     Subd. 3.  [PAYMENT OF DEFERRED SPECIAL 
 61.27  ASSESSMENTS.] Beginning with earlier of (1) the tax payable in 
 61.28  2003, or (2) the date ownership of the property is transferred 
 61.29  to anyone other than the spouse or child of the current owner or 
 61.30  an organization described in subdivision 2 for a property 
 61.31  qualifying under section 28, all deferred special assessments 
 61.32  plus interest are payable in equal installments spread over the 
 61.33  time remaining until the last maturity date of the bonds issued 
 61.34  to finance the improvement for which the assessments were 
 61.35  levied.  If the bonds have matured or if no bonds were issued to 
 61.36  finance the improvements, the deferred special assessments plus 
 62.1   interest are payable within 90 days.  The provisions of 
 62.2   Minnesota Statutes, section 429.061, subdivision 2, apply to the 
 62.3   collection of these installments.  Penalty may not be levied on 
 62.4   any such special assessments if timely paid. 
 62.5      Subd. 4.  [CURRENT OWNER.] For purposes of this section, 
 62.6   "current owner" means the owner of property qualifying under 
 62.7   section 28 on the date of final enactment of this act.  
 62.8      Subd. 5.  [NONPROFIT FOUNDATION OR CORPORATION.] For 
 62.9   purposes of sections 28 to 32, "nonprofit foundation or 
 62.10  corporation" means a nonprofit entity created to own and operate 
 62.11  the property as an art park providing the services included in 
 62.12  section 28, clauses (2) to (5). 
 62.13     Sec. 33.  [WATER SUPPLY PROJECTS OF MORE THAN $15,000,000.] 
 62.14     Notwithstanding Minnesota Statutes, chapter 410, or 
 62.15  Minneapolis city charter, chapter 15, section 9, the city of 
 62.16  Minneapolis and its board of estimate and taxation may issue and 
 62.17  sell bonds or incur other indebtedness for a capital improvement 
 62.18  project related to water supply that in all phases from 
 62.19  inception to completion exceeds $15,000,000 without submitting 
 62.20  the question of issuing such obligations or incurring such 
 62.21  indebtedness to the electorate for approval. 
 62.22     Sec. 34.  [EFFECTIVE DATE.] 
 62.23     Sections 1, 4 to 9, and 13 to 16 are effective for property 
 62.24  taxes assessed in 1998 and payable in 1999, and thereafter. 
 62.25     Sections 2 and 3 are effective for real estate sales and 
 62.26  transfers occurring on or after July 1, 1998.  
 62.27     Section 10 is effective for public hearings held in 1998, 
 62.28  and thereafter. 
 62.29     Section 11 is effective for property taxes payable in 1998 
 62.30  only. 
 62.31     Section 18 is effective for aids payable in 1999 and 
 62.32  thereafter. 
 62.33     Sections 19 to 21 are effective upon compliance by the 
 62.34  governing body of the city of St. Paul with Minnesota Statutes, 
 62.35  section 645.021, subdivision 3. 
 62.36     Sections 22 and 23 are effective upon compliance by the 
 63.1   governing body of Anoka county with Minnesota Statutes, section 
 63.2   645.021, subdivision 3. 
 63.3      Section 24 is effective for property taxes levied in 1997, 
 63.4   payable in 1998, and thereafter. 
 63.5      Sections 28 to 32 are effective beginning with taxes 
 63.6   payable in 1998 and ending with taxes payable in 2003. 
 63.7      Section 33 is effective the day following final enactment. 
 63.8                              ARTICLE 3
 63.9                SENIOR CITIZEN'S PROPERTY TAX DEFERRAL
 63.10     Section 1.  Minnesota Statutes 1997 Supplement, section 
 63.11  290B.04, subdivision 1, is amended to read: 
 63.12     Subdivision 1.  [INITIAL APPLICATION.] A taxpayer meeting 
 63.13  the program qualifications under section 290B.03 may apply to 
 63.14  the commissioner of revenue for the deferral of taxes.  
 63.15  Applications are due on or before July 1 for deferral of any of 
 63.16  the following year's property taxes.  A taxpayer may apply in 
 63.17  the year in which the taxpayer becomes 65 years old, provided 
 63.18  that no deferral of property taxes will be made until the 
 63.19  calendar year after the taxpayer becomes 65 years old.  The 
 63.20  application, which shall be prescribed by the commissioner of 
 63.21  revenue, shall include the following items and any other 
 63.22  information which the commissioner deems necessary: 
 63.23     (1) the name, address, and social security number of the 
 63.24  owner or owners; 
 63.25     (2) a copy of the property tax statement for the current 
 63.26  payable year for the homesteaded property; 
 63.27     (3) the initial year of ownership and occupancy as a 
 63.28  homestead; 
 63.29     (4) the owner's household income for the previous calendar 
 63.30  year; and 
 63.31     (5) information on any mortgage loans or other amounts 
 63.32  secured by mortgages or other liens against the property, for 
 63.33  which purpose the commissioner may require the applicant to 
 63.34  provide a copy of the mortgage note, the mortgage, or a 
 63.35  statement of the balance owing on the mortgage loan provided by 
 63.36  the mortgage holder.  The commissioner may require the 
 64.1   appropriate documents in connection with obtaining and 
 64.2   confirming information on unpaid amounts secured by other 
 64.3   liens.  As a condition for approving an initial application, the 
 64.4   commissioner may require applicants to obtain at their own cost, 
 64.5   a report which has been prepared by a licensed abstracter 
 64.6   showing the existing mortgages, lien notices, and other 
 64.7   obligations or encumbrances which are on record against the 
 64.8   involved property or the applicant as of 30 days prior to the 
 64.9   date of such report, and to submit that report by the due date 
 64.10  of the initial application.  The commissioner may also require 
 64.11  the county recorder or county registrar in the county where the 
 64.12  property is located to provide other documents or information 
 64.13  related to the applicant or the property, for which the recorder 
 64.14  or registrar shall not charge a fee. 
 64.15     The application must state that program participation is 
 64.16  voluntary.  The application must also state that the deferred 
 64.17  amount depends directly on the applicant's household income, and 
 64.18  that program participation includes authorization for the 
 64.19  deferred amount for each year and the cumulative deferral and 
 64.20  interest to appear on each year's property tax statement as 
 64.21  public data. 
 64.22     Sec. 2.  Minnesota Statutes 1997 Supplement, section 
 64.23  290B.04, subdivision 3, is amended to read: 
 64.24     Subd. 3.  [ANNUAL EXCESS-INCOME CERTIFICATION BY TAXPAYER.] 
 64.25  Annually on or before July 1, A taxpayer whose initial 
 64.26  application has been approved under subdivision 2, shall 
 64.27  complete the a certification form and return it to the 
 64.28  commissioner of revenue by July 1 of each year of eligibility if 
 64.29  the taxpayer's household income in the preceding year exceeded 
 64.30  $30,000.  The certification must state whether or not the 
 64.31  taxpayer wishes to have property taxes deferred for the 
 64.32  following year provided the taxes exceed the maximum property 
 64.33  tax amount under section 290B.05.  If the taxpayer does wish to 
 64.34  have property taxes deferred, the certification must state the 
 64.35  homeowner's total household income for the previous calendar 
 64.36  year and any other information which the commissioner deems 
 65.1   necessary.  No property taxes may be deferred under chapter 290B 
 65.2   in the year following the year in which a program participant is 
 65.3   required to file an excess-income certification under this 
 65.4   subdivision. 
 65.5      Sec. 3.  Minnesota Statutes 1997 Supplement, section 
 65.6   290B.05, subdivision 1, is amended to read: 
 65.7      Subdivision 1.  [DETERMINATION BY COMMISSIONER.] The 
 65.8   commissioner shall annually determine the qualifying homeowner's 
 65.9   "maximum property tax amount" and "maximum allowable deferral."  
 65.10  The maximum property tax amount calculated for taxes payable in 
 65.11  the following year is equal to five percent of the homeowner's 
 65.12  total household income for the previous calendar year.  No tax 
 65.13  may be deferred for any homeowner whose total household income 
 65.14  for the previous year exceeds $30,000.  No tax shall be deferred 
 65.15  in any year in which the homeowner or the property does not meet 
 65.16  the program qualifications in section 290B.03, subdivision 1, 
 65.17  clauses (1) and (3) through (8).  The maximum allowable total 
 65.18  deferral is equal to 75 percent of the assessor's estimated 
 65.19  market value for the year, less (1) the balance of any mortgage 
 65.20  loans and other amounts secured by liens against the property at 
 65.21  the time of application, including any unpaid special 
 65.22  assessments but not including property taxes payable during the 
 65.23  year; and (2) any outstanding deferral and interest.  
 65.24     Sec. 4.  Minnesota Statutes 1997 Supplement, section 
 65.25  290B.05, subdivision 2, is amended to read: 
 65.26     Subd. 2.  [CERTIFICATION BY COMMISSIONER.] On or before 
 65.27  December 1, the commissioner shall certify to the county auditor 
 65.28  of the county in which the qualifying homestead is located (1) 
 65.29  the maximum property tax amount; (2) the maximum allowable 
 65.30  deferral for the year; and (3) the cumulative deferral and 
 65.31  interest for all years preceding the next taxes payable year. 
 65.32     Sec. 5.  Minnesota Statutes 1997 Supplement, section 
 65.33  290B.05, subdivision 3, is amended to read: 
 65.34     Subd. 3.  [CALCULATION OF DEFERRED PROPERTY TAX AMOUNT.] 
 65.35  When final property tax amounts for the following year have been 
 65.36  determined, the county auditor shall calculate the "deferred 
 66.1   property tax amount."  The deferred property tax amount is equal 
 66.2   to the lesser of (1) the maximum allowable deferral for the 
 66.3   year; or (2) the difference between the total amount of property 
 66.4   taxes levied upon the qualifying homestead by all taxing 
 66.5   jurisdictions and the maximum property tax amount.  Any special 
 66.6   assessments levied by any local unit of government must not be 
 66.7   included in the total tax used to calculate the deferred tax 
 66.8   amount.  No deferral of the current year's property taxes is 
 66.9   allowed if there are any delinquent property taxes or delinquent 
 66.10  special assessments for any previous year.  Any tax attributable 
 66.11  to new improvements made to the property after the initial 
 66.12  application has been approved under section 290B.04, subdivision 
 66.13  2, must be excluded when determining any subsequent deferred 
 66.14  property tax amount.  The county auditor shall annually, on or 
 66.15  before April 15, certify to the commissioner of revenue the 
 66.16  property tax deferral amounts determined under this subdivision 
 66.17  by property and by owner.  
 66.18     Sec. 6.  Minnesota Statutes 1997 Supplement, section 
 66.19  290B.06, is amended to read: 
 66.20     290B.06 [PROPERTY TAX REFUNDS.] 
 66.21     For purposes of qualifying for the regular property tax 
 66.22  refund or the special refund for homeowners under chapter 290A, 
 66.23  the qualifying tax is the full amount of taxes, including the 
 66.24  deferred portion of the tax.  In any year in which a program 
 66.25  participant chooses to have property taxes deferred under this 
 66.26  section, any regular or special property tax refund awarded 
 66.27  based upon those property taxes must be taken first as a 
 66.28  deduction from the amount of the deferred tax for that year, and 
 66.29  second as a deduction against any outstanding deferral from 
 66.30  previous years, rather than as a cash payment to the homeowner.  
 66.31  The commissioner shall cancel any current year's deferral or 
 66.32  previous years' deferral and interest that is offset by the 
 66.33  property tax refunds.  If the total of the regular and the 
 66.34  special property tax refund amounts exceeds the sum of the 
 66.35  deferred tax for the current year and cumulative deferred tax 
 66.36  and interest for previous years, the commissioner shall then 
 67.1   remit the excess amount to the homeowner.  On or before the date 
 67.2   on which the commissioner issues property tax refunds, the 
 67.3   commissioner shall notify program participants of any reduction 
 67.4   in the deferred amount for the current and previous years 
 67.5   resulting from property tax refunds. 
 67.6      Sec. 7.  Minnesota Statutes 1997 Supplement, section 
 67.7   290B.07, is amended to read: 
 67.8      290B.07 [LIEN; DEFERRED PORTION.] 
 67.9      (a) Payment by the state to the county treasurer of taxes 
 67.10  deferred under this section is deemed a loan from the state to 
 67.11  the program participant.  The commissioner must compute the 
 67.12  interest as provided in section 270.75, subdivision 5, but not 
 67.13  to exceed five percent, and maintain records of the total 
 67.14  deferred amount and interest for each participant.  Interest 
 67.15  shall accrue beginning September 1 of the payable year for which 
 67.16  the taxes are deferred.  The lien created under section 272.31 
 67.17  continues to secure payment by the taxpayer, or by the 
 67.18  taxpayer's successors or assigns, of the amount deferred, 
 67.19  including interest, with respect to all years for which amounts 
 67.20  are deferred.  The lien for deferred taxes and interest has the 
 67.21  same priority as any other lien under section 272.31, except 
 67.22  that liens, including mortgages, recorded or filed prior to the 
 67.23  recording or filing of the notice under section 290B.04, 
 67.24  subdivision 2, have priority over the lien for deferred taxes 
 67.25  and interest.  A seller's interest in a contract for deed, in 
 67.26  which a qualifying homeowner is the purchaser or an assignee of 
 67.27  the purchaser, has priority over deferred taxes and interest on 
 67.28  deferred taxes, regardless of whether the contract for deed is 
 67.29  recorded or filed.  The lien for deferred taxes and interest for 
 67.30  future years has the same priority as the lien for deferred 
 67.31  taxes and interest for the first year, which is always higher in 
 67.32  priority than any mortgages or other liens filed, recorded, or 
 67.33  created after the notice recorded or filed under section 
 67.34  290B.04, subdivision 2.  The county treasurer or auditor shall 
 67.35  maintain records of the deferred portion and shall list the 
 67.36  amount of deferred taxes for the year and the cumulative 
 68.1   deferral and interest for all previous years as a lien against 
 68.2   the property on the property tax statement.  In any 
 68.3   certification of unpaid taxes for a tax parcel, the county 
 68.4   auditor shall clearly distinguish between taxes payable in the 
 68.5   current year, deferred taxes and interest, and delinquent 
 68.6   taxes.  Payment of the deferred portion becomes due and owing at 
 68.7   the time specified in section 290B.08.  Upon receipt of the 
 68.8   payment, the commissioner shall issue a receipt for it to the 
 68.9   person making the payment upon request and shall notify the 
 68.10  auditor of the county in which the parcel is located, within ten 
 68.11  days, identifying the parcel to which the payment applies.  Upon 
 68.12  receipt by the commissioner of revenue of collected funds in the 
 68.13  amount of the deferral, the state's loan to the program 
 68.14  participant is deemed paid in full. 
 68.15     (b) If property for which taxes have been deferred under 
 68.16  this chapter forfeits under chapter 281 for nonpayment of a 
 68.17  nondeferred property tax amount, or because of nonpayment of 
 68.18  amounts previously deferred following a termination under 
 68.19  section 290B.08, the lien for the taxes deferred under this 
 68.20  chapter, plus interest and costs, shall be canceled by the 
 68.21  county auditor as provided in section 282.07.  However, 
 68.22  notwithstanding any other law to the contrary, any proceeds from 
 68.23  a subsequent sale of the property under chapter 282 or another 
 68.24  law, must be used to first reimburse the county's forfeited tax 
 68.25  sale fund for any direct costs of selling the property or any 
 68.26  costs directly related to preparing the property for sale, and 
 68.27  then to reimburse the state for the amount of the canceled 
 68.28  lien.  Within 90 days of the receipt of any sale proceed to 
 68.29  which the state is entitled under these provisions, the county 
 68.30  auditor must pay those funds to the commissioner of revenue by 
 68.31  warrant for deposit in the general fund.  No other deposit, use, 
 68.32  distribution, or release of gross sale proceeds or receipts may 
 68.33  be made by the county until payments sufficient to fully 
 68.34  reimburse the state for the canceled lien amount have been 
 68.35  transmitted to the commissioner. 
 68.36     Sec. 8.  [290B.10] [INVESTIGATIONS; PENALTIES.] 
 69.1      The commissioner may use any information to which he or she 
 69.2   has access under the law in determining or verifying eligibility 
 69.3   under any provision of the senior citizens' property tax 
 69.4   deferral program.  The commissioner may conduct investigations 
 69.5   related to initial applications and excess-income certifications 
 69.6   required under this chapter within the period ending 3-1/2 years 
 69.7   from the due date of the application or certification.  The 
 69.8   commissioner shall assess a penalty equal to 50 percent of the 
 69.9   property taxes improperly deferred in the case of a false 
 69.10  application, a false certification, or in the case of a required 
 69.11  excess-income certification which was not filed as of the 
 69.12  applicable due date.  The commissioner shall assess a penalty 
 69.13  equal to 100 percent of the property taxes improperly deferred 
 69.14  if the taxpayer knowingly filed a false application or 
 69.15  certification, or knowingly failed to file a required 
 69.16  excess-income certification by the applicable due date.  The 
 69.17  commissioner shall assess penalties under this section through 
 69.18  the issuance of an order under the provisions of chapter 289A.  
 69.19  Persons affected by a commissioner's order issued under this 
 69.20  section may appeal as provided in chapter 289A. 
 69.21     Sec. 9.  [EFFECTIVE DATE.] 
 69.22     Sections 1 to 8 are effective for deferrals of property 
 69.23  taxes payable in 1999 and thereafter. 
 69.24                             ARTICLE 4
 69.25              TAX INCREMENT FINANCING AND DEVELOPMENT
 69.26     Section 1.  Minnesota Statutes 1996, section 469.174, is 
 69.27  amended by adding a subdivision to read: 
 69.28     Subd. 28.  [DECERTIFY OR DECERTIFICATION.] "Decertify" or 
 69.29  "decertification" means the termination of a tax increment 
 69.30  financing district which occurs when the county auditor removes 
 69.31  all remaining parcels from the district. 
 69.32     Sec. 2.  Minnesota Statutes 1996, section 469.175, 
 69.33  subdivision 5, is amended to read: 
 69.34     Subd. 5.  [ANNUAL DISCLOSURE.] (a) For all tax increment 
 69.35  financing districts, whether created prior or subsequent to 
 69.36  August 1, 1979, on or before July 1 of each year, The authority 
 70.1   shall annually submit to the county board, the county auditor, 
 70.2   the school board, state auditor and, if the authority is other 
 70.3   than the municipality, the governing body of the municipality, a 
 70.4   report of the status of the district.  The report shall include 
 70.5   the following information:  the amount and the source of revenue 
 70.6   in the account, the amount and purpose of expenditures from the 
 70.7   account, the amount of any pledge of revenues, including 
 70.8   principal and interest on any outstanding bonded indebtedness, 
 70.9   the original net tax capacity of the district and any 
 70.10  subdistrict, the captured net tax capacity retained by the 
 70.11  authority, the captured net tax capacity shared with other 
 70.12  taxing districts, the tax increment received, and any additional 
 70.13  information necessary to demonstrate compliance with any 
 70.14  applicable tax increment financing plan.  The authority must 
 70.15  submit the annual report for a year on or before August 1 of the 
 70.16  next year. 
 70.17     (b) An annual statement showing the tax increment received 
 70.18  and expended in that year, the original net tax capacity, 
 70.19  captured net tax capacity, amount of outstanding bonded 
 70.20  indebtedness, the amount of the district's and any subdistrict's 
 70.21  increments paid to other governmental bodies, the amount paid 
 70.22  for administrative costs, the sum of increments paid, directly 
 70.23  or indirectly, for activities and improvements located outside 
 70.24  of the district, and any additional information the authority 
 70.25  deems necessary shall be published in a newspaper of general 
 70.26  circulation in the municipality.  If the fiscal disparities 
 70.27  contribution under chapter 276A or 473F for the district is 
 70.28  computed under section 469.177, subdivision 3, paragraph (a), 
 70.29  the annual statement must disclose that fact and indicate the 
 70.30  amount of increased property tax imposed on other properties in 
 70.31  the municipality as a result of the fiscal disparities 
 70.32  contribution.  The commissioner of revenue shall prescribe the 
 70.33  form of this statement and the method for calculating the 
 70.34  increased property taxes.  The authority must publish the annual 
 70.35  statement for a year no later than July 1 August 15 of the next 
 70.36  year.  The authority must provide identify the newspaper of 
 71.1   general circulation in the municipality to which the annual 
 71.2   statement has been or will be submitted for publication and 
 71.3   provide a copy of the annual statement to the state auditor by 
 71.4   the time it submits it for publication on or before August 1 of 
 71.5   the year in which the statement must be published.  
 71.6      (c) The disclosure and reporting requirements imposed by 
 71.7   this subdivision apply to districts certified before, on, or 
 71.8   after August 1, 1979. 
 71.9      Sec. 3.  Minnesota Statutes 1996, section 469.175, 
 71.10  subdivision 6, is amended to read: 
 71.11     Subd. 6.  [FINANCIAL REPORTING.] (a) The state auditor 
 71.12  shall develop a uniform system of accounting and financial 
 71.13  reporting for tax increment financing districts.  The system of 
 71.14  accounting and financial reporting shall, as nearly as possible: 
 71.15     (1) provide for full disclosure of the sources and uses of 
 71.16  public funds in the district; 
 71.17     (2) permit comparison and reconciliation with the affected 
 71.18  local government's accounts and financial reports; 
 71.19     (3) permit auditing of the funds expended on behalf of a 
 71.20  district, including a single district that is part of a 
 71.21  multidistrict project or that is funded in part or whole through 
 71.22  the use of a development account funded with tax increments from 
 71.23  other districts or with other public money; 
 71.24     (4) be consistent with generally accepted accounting 
 71.25  principles. 
 71.26     (b) The authority must annually submit to the state 
 71.27  auditor, on or before July 1, a financial report in compliance 
 71.28  with paragraph (a).  Copies of the report must also be provided 
 71.29  to the county and school district boards and to the governing 
 71.30  body of the municipality, if the authority is not the 
 71.31  municipality.  To the extent necessary to permit compliance with 
 71.32  the requirement of financial reporting, the county and any other 
 71.33  appropriate local government unit or private entity must provide 
 71.34  the necessary records or information to the authority or the 
 71.35  state auditor as provided by the system of accounting and 
 71.36  financial reporting developed pursuant to paragraph (a).  The 
 72.1   authority must submit the annual report for a year on or before 
 72.2   August 1 of the next year. 
 72.3      (c) The annual financial report must also include the 
 72.4   following items: 
 72.5      (1) the original net tax capacity of the district and any 
 72.6   subdistrict; 
 72.7      (2) the captured net tax capacity of the district, 
 72.8   including the amount of any captured net tax capacity shared 
 72.9   with other taxing districts; 
 72.10     (3) for the reporting period and for the duration of the 
 72.11  district, the amount budgeted under the tax increment financing 
 72.12  plan, and the actual amount expended for, at least, the 
 72.13  following categories: 
 72.14     (i) acquisition of land and buildings through condemnation 
 72.15  or purchase; 
 72.16     (ii)  site improvements or preparation costs; 
 72.17     (iii) installation of public utilities, parking facilities, 
 72.18  streets, roads, sidewalks, or other similar public improvements; 
 72.19     (iv) administrative costs, including the allocated cost of 
 72.20  the authority; 
 72.21     (v) public park facilities, facilities for social, 
 72.22  recreational, or conference purposes, or other similar public 
 72.23  improvements; 
 72.24     (4) for properties sold to developers, the total cost of 
 72.25  the property to the authority and the price paid by the 
 72.26  developer; and 
 72.27     (5) the amount of increments rebated or paid to developers 
 72.28  or property owners for privately financed improvements or other 
 72.29  qualifying costs. 
 72.30     (d) The reporting requirements imposed by this subdivision 
 72.31  apply to districts certified before, on, and after August 1, 
 72.32  1979. 
 72.33     Sec. 4.  Minnesota Statutes 1996, section 469.175, 
 72.34  subdivision 6a, is amended to read: 
 72.35     Subd. 6a.  [REPORTING REQUIREMENTS.] (a) The municipality 
 72.36  must annually report to the state auditor the following amounts 
 73.1   for the entire municipality: 
 73.2      (1) the total principal amount of nondefeased tax increment 
 73.3   financing bonds that are outstanding at the end of the previous 
 73.4   calendar year; and 
 73.5      (2) the total annual amount of principal and interest 
 73.6   payments that are due for the current calendar year on (i) 
 73.7   general obligation tax increment financing bonds, and (ii) other 
 73.8   tax increment financing bonds. 
 73.9      (b) The municipality must annually report to the state 
 73.10  auditor the following amounts for each tax increment financing 
 73.11  district located in the municipality: 
 73.12     (1) the type of district, whether economic development, 
 73.13  redevelopment, housing, soils condition, mined underground 
 73.14  space, or hazardous substance site; 
 73.15     (2) the date on which the district is required to be 
 73.16  decertified; 
 73.17     (3) the amount of any payments and the value of in-kind 
 73.18  benefits, such as physical improvements and the use of building 
 73.19  space, that are financed with revenues derived from increments 
 73.20  and are provided to another governmental unit (other than the 
 73.21  municipality) during the preceding calendar year; 
 73.22     (4) the tax increment revenues for taxes payable in the 
 73.23  current calendar year; 
 73.24     (5) whether the tax increment financing plan or other 
 73.25  governing document permits increment revenues to be expended (i) 
 73.26  to pay bonds, the proceeds of which were or may be expended on 
 73.27  activities located outside of the district, (ii) for deposit 
 73.28  into a common fund from which money may be expended on 
 73.29  activities located outside of the district, or (iii) to 
 73.30  otherwise finance activities located outside of the tax 
 73.31  increment financing district; and 
 73.32     (6) any additional information that the state auditor may 
 73.33  require.  
 73.34     (c) The report required by this subdivision must be filed 
 73.35  with the state auditor on or before July 1 of each year.  The 
 73.36  municipality must submit the annual report for a year required 
 74.1   by this subdivision on or before August 1 of the next year. 
 74.2      (d) The state auditor may provide for combining the reports 
 74.3   required by this subdivision and subdivisions 5 and 6 so that 
 74.4   only one report is made for each year to the auditor. 
 74.5      (e) This section applies to districts certified before, on, 
 74.6   and after August 1, 1979. 
 74.7      Sec. 5.  Minnesota Statutes 1996, section 469.175, is 
 74.8   amended by adding a subdivision to read: 
 74.9      Subd. 6b.  [DURATION OF DISCLOSURE AND REPORTING 
 74.10  REQUIREMENTS.] The disclosure and reporting requirements imposed 
 74.11  by subdivisions 5, 6, and 6a apply with respect to a tax 
 74.12  increment financing district beginning with the annual 
 74.13  disclosure and reports for the year in which the original net 
 74.14  tax capacity of the district was certified and ending with the 
 74.15  annual disclosure and reports for the year in which both of the 
 74.16  following events have occurred: 
 74.17     (1) decertification of the district; and 
 74.18     (2) expenditure or return to the county auditor of all 
 74.19  remaining revenues derived from tax increments paid by 
 74.20  properties in the district. 
 74.21     Sec. 6.  Minnesota Statutes 1996, section 469.176, 
 74.22  subdivision 7, is amended to read: 
 74.23     Subd. 7.  [PARCELS NOT INCLUDABLE IN DISTRICTS.] The 
 74.24  authority may request inclusion in a tax increment financing 
 74.25  district and the county auditor may certify the original tax 
 74.26  capacity of a parcel or a part of a parcel that qualified under 
 74.27  the provisions of section 273.111 or 273.112 or chapter 473H for 
 74.28  taxes payable in any of the five calendar years before the 
 74.29  filing of the request for certification only for 
 74.30     (1) a district in which 85 percent or more of the planned 
 74.31  buildings and facilities (determined on the basis of square 
 74.32  footage) are for manufacturing or production of tangible 
 74.33  personal property, including processing resulting in the change 
 74.34  in condition of the property or space necessary for and related 
 74.35  to the manufacturing activities; or 
 74.36     (2) a qualified housing district as defined in section 
 75.1   273.1399, subdivision 1. 
 75.2      Sec. 7.  Minnesota Statutes 1996, section 469.177, is 
 75.3   amended by adding a subdivision to read: 
 75.4      Subd. 12.  [DECERTIFICATION OF TAX INCREMENT FINANCING 
 75.5   DISTRICT.] The county auditor shall decertify a tax increment 
 75.6   financing district when the earliest of the following times is 
 75.7   reached: 
 75.8      (1) the applicable maximum duration limit under section 
 75.9   469.176, subdivisions 1a to 1g; 
 75.10     (2) the maximum duration limit, if any, provided by the 
 75.11  municipality pursuant to section 469.176, subdivision 1; 
 75.12     (3) the time of decertification specified in section 
 75.13  469.1761, subdivision 4, if the commissioner of revenue issues 
 75.14  an order of noncompliance and the maximum duration limit for 
 75.15  economic development districts has been exceeded; 
 75.16     (4) upon completion of the required actions to allow 
 75.17  decertification under section 469.1763, subdivision 4; or 
 75.18     (5) upon receipt by the county auditor of a written request 
 75.19  for decertification from the authority that requested 
 75.20  certification of the original net tax capacity of the district 
 75.21  or its successor. 
 75.22     Sec. 8.  Minnesota Statutes 1996, section 469.1771, is 
 75.23  amended by adding a subdivision to read: 
 75.24     Subd. 2a.  [SUSPENSION OF DISTRIBUTION OF TAX 
 75.25  INCREMENT.] (a) If an authority fails to make a disclosure or to 
 75.26  submit a report containing the information required by section 
 75.27  469.175, subdivisions 5 and 6, regarding a tax increment 
 75.28  financing district within the time provided in section 469.175, 
 75.29  subdivisions 5 and 6, or if a municipality fails to submit a 
 75.30  report containing the information required of section 469.175, 
 75.31  subdivision 6a, regarding a tax increment financing district 
 75.32  within the time provided in section 469.175, subdivision 6a, the 
 75.33  state auditor shall mail to the authority a written notice that 
 75.34  it or the municipality has failed to make the required 
 75.35  disclosure or to submit a required report with respect to a 
 75.36  particular district.  The state auditor shall mail the notice on 
 76.1   or before the third Tuesday of August of the year in which the 
 76.2   disclosure or report was required to be made or submitted.  The 
 76.3   notice shall describe the consequences of failing to disclose or 
 76.4   submit a report as provided in paragraph (b).  If the state 
 76.5   auditor has not received a copy of a disclosure or a report 
 76.6   described in this paragraph on or before the third Tuesday of 
 76.7   November of the year in which the disclosure or report was 
 76.8   required to be made or submitted, the state auditor shall mail a 
 76.9   written notice to the county auditor to hold the distribution of 
 76.10  tax increment from a particular district.  
 76.11     (b) Upon receiving written notice from the state auditor to 
 76.12  hold the distribution of tax increment, the county auditor shall 
 76.13  hold: 
 76.14     (1) 25 percent of the amount of tax increment that 
 76.15  otherwise would be distributed, if the distribution is made 
 76.16  after the third Friday in November but during the year in which 
 76.17  the disclosure or report was required to be made or submitted; 
 76.18  or 
 76.19     (2) 100 percent of the amount of tax increment that 
 76.20  otherwise would be distributed, if the distribution is made 
 76.21  after December 31 of the year in which the disclosure or report 
 76.22  was required to be made or submitted. 
 76.23     (c) Upon receiving the copy of the disclosure and all of 
 76.24  the reports described in paragraph (a) with respect to a 
 76.25  district regarding which the state auditor has mailed to the 
 76.26  county auditor a written notice to hold distribution of tax 
 76.27  increment, the state auditor shall mail to the county auditor a 
 76.28  written notice lifting the hold and authorizing the county 
 76.29  auditor to distribute to the authority or municipality any tax 
 76.30  increment that the county auditor had held pursuant to paragraph 
 76.31  (b).  The state auditor shall mail the written notice required 
 76.32  by this paragraph within five working days after receiving the 
 76.33  last outstanding item.  The county auditor shall distribute the 
 76.34  tax increment to the authority or municipality within 15 working 
 76.35  days after receiving the written notice required by this 
 76.36  paragraph. 
 77.1      (d) Notwithstanding any law to the contrary, any interest 
 77.2   that accrues on tax increment while it is being held by the 
 77.3   county auditor pursuant to paragraph (b) is not tax increment 
 77.4   and may be retained by the county. 
 77.5      (e) For purposes of sections 469.176, subdivisions 1a to 
 77.6   1g, and 469.177, subdivision 11, tax increment being held by the 
 77.7   county auditor pursuant to paragraph (b) shall be considered 
 77.8   distributed to or received by the authority or municipality as 
 77.9   of the time that it would have been distributed or received but 
 77.10  for paragraph (b). 
 77.11     Sec. 9.  Minnesota Statutes 1996, section 469.1771, 
 77.12  subdivision 5, is amended to read: 
 77.13     Subd. 5.  [DISPOSITION OF PAYMENTS.] If the authority does 
 77.14  not have sufficient increments or other available money to make 
 77.15  a payment required by this section, the municipality that 
 77.16  approved the district must use any available money to make the 
 77.17  payment including the levying of property taxes.  Money received 
 77.18  by the county auditor under this section must be distributed as 
 77.19  excess increments under section 469.176, subdivision 2, 
 77.20  paragraph (a), clause (4)., except that if the county auditor 
 77.21  receives the payment after (1) 60 days from a municipality's 
 77.22  receipt of the state auditor's notification under subdivision 1, 
 77.23  paragraph (c), of noncompliance requiring the payment, or (2) 
 77.24  the commencement of an action by the county attorney to compel 
 77.25  the payment, then no distributions may be made to the 
 77.26  municipality that approved the tax increment financing district. 
 77.27     Sec. 10.  Minnesota Statutes 1997 Supplement, section 
 77.28  469.1812, subdivision 4, is amended to read: 
 77.29     Subd. 4.  [POLITICAL SUBDIVISION OR SUBDIVISION.] 
 77.30  "Political subdivision" or "subdivision" means a statutory or 
 77.31  home rule charter city, town, or school district, or county. 
 77.32     Sec. 11.  Laws 1965, chapter 326, section 1, subdivision 5, 
 77.33  as amended by Laws 1975, chapter 110, section 1, and Laws 1985, 
 77.34  chapter 87, section 3, is amended to read: 
 77.35     Subd. 5.  [PROMOTION OF TOURIST, AGRICULTURAL AND 
 77.36  INDUSTRIAL DEVELOPMENT.] The amount to be spent annually for the 
 78.1   purposes of this subdivision shall not exceed $1 $4 per capita 
 78.2   of the county's population. 
 78.3      Sec. 12.  [BROOKLYN CENTER SPECIAL TAXING DISTRICT.] 
 78.4      Subdivision 1.  [DEFINITIONS.] (a) As used in this section, 
 78.5   the terms defined in this subdivision have the meanings given 
 78.6   them. 
 78.7      (b) "City" means the city of Brooklyn Center. 
 78.8      (c) "Enabling ordinance" means the ordinance adopted by the 
 78.9   city council establishing the Brookdale special taxing district. 
 78.10     (d) "Brookdale special taxing district" means all or any 
 78.11  portion of the following described property within tax increment 
 78.12  financing district no. 3 in the city: 
 78.13     All that property that is located within the area bounded 
 78.14  by a continuous line beginning at a point at the intersection of 
 78.15  county road no. 10 and trunk highway 100 and going southwesterly 
 78.16  along the center line of trunk highway 100 to its intersection 
 78.17  with Brooklyn boulevard; thence northerly along the center line 
 78.18  of Brooklyn boulevard to a point 476.52 feet northerly of the 
 78.19  intersection of Brooklyn boulevard and county road no. 10; 
 78.20  thence easterly from that point along a straight line to the 
 78.21  center line of Shingle Creek; thence southerly along the center 
 78.22  line of Shingle Creek to its intersection with the north 
 78.23  right-of-way line of county road no. 10; thence easterly along 
 78.24  the north right-of-way line of county road no. 10 to the east 
 78.25  right-of-way line of Shingle Creek parkway; thence northerly 
 78.26  along the west property line of lot 2, block 2, Brookdale square 
 78.27  addition 165.43 feet; thence northeasterly along the northwest 
 78.28  property line of lot 2, block 2, Brookdale square addition 
 78.29  297.73 feet; thence easterly along the north property line of 
 78.30  lot 2, block 2, Brookdale square addition 914.34 feet; thence 
 78.31  southerly 517.9 feet along the easterly property line of lot 2, 
 78.32  block 2, Brookdale square addition extended to the center line 
 78.33  of county road no. 10; thence easterly along the center line of 
 78.34  county road no. 10 to the point of the beginning. 
 78.35     (e) "Redevelopment services" has the meaning given in the 
 78.36  city's enabling ordinance, and may include any services or 
 79.1   expenditures the city or its economic development authority may 
 79.2   provide or incur under Minnesota Statutes, sections 469.001 to 
 79.3   469.047, and 469.090 to 469.1081, including without limitation 
 79.4   amounts necessary to pay the principal of or interest on bonds 
 79.5   issued by the city or its economic development authority under 
 79.6   section 469.178. 
 79.7      Subd. 2.  [ESTABLISHMENT OF BROOKDALE SPECIAL TAXING 
 79.8   DISTRICT.] The governing body of the city may adopt an ordinance 
 79.9   establishing the Brookdale special taxing district.  The 
 79.10  ordinance must describe with particularity the property to be 
 79.11  included in the district and the redevelopment services to be 
 79.12  provided in the district.  Only property that is subject to an 
 79.13  assessment agreement with the city or its economic development 
 79.14  authority under Minnesota Statutes, section 469.177, subdivision 
 79.15  8, as of the date of adoption of the ordinance may be included 
 79.16  within the Brookdale special taxing district and be subject to 
 79.17  the tax imposed by the city on the district.  The area of the 
 79.18  Brookdale special taxing district may include noncontiguous 
 79.19  parcels within the area described in subdivision 1, paragraph 
 79.20  (d). 
 79.21     Subd. 3.  [MODIFICATION OF SPECIAL TAXING DISTRICT.] The 
 79.22  boundaries of the Brookdale special taxing district may be 
 79.23  enlarged or reduced under the procedures for establishment of 
 79.24  the district under subdivision 2.  Property added to the 
 79.25  district is subject to the special tax imposed within the 
 79.26  district after the property becomes a part of the district. 
 79.27     Subd. 4.  [SPECIAL TAX AUTHORITY.] The city may impose a 
 79.28  special tax within the Brookdale special taxing district that is 
 79.29  reasonably related to the redevelopment services provided.  The 
 79.30  tax may be imposed at a rate or amount sufficient to produce the 
 79.31  revenues required to provide redevelopment services within the 
 79.32  district.  The special tax is payable only in a year in which 
 79.33  the assessment agreement for the property subject to the tax 
 79.34  remains in effect for that taxes payable year.  The maximum levy 
 79.35  may not exceed the amount specified in the assessment agreement. 
 79.36     The tax imposed under this section is not included in the 
 80.1   calculation of levies or limits imposed under law or chapter. 
 80.2      Subd. 5.  [COLLECTION OF TAX.] The special tax must be 
 80.3   imposed on the net tax capacity of the taxable property located 
 80.4   in the geographic area described in the ordinance.  Taxable net 
 80.5   tax capacity must be determined without regard to captured or 
 80.6   original net tax capacity under Minnesota Statutes, section 
 80.7   469.177, or to the distribution or contribution value under 
 80.8   section 473F.08.  The special tax is payable and must be 
 80.9   collected at the same time and in the same manner as provided 
 80.10  for payment and collection of ad valorem taxes.  Special taxes 
 80.11  not paid on or before the applicable due date are subject to the 
 80.12  same penalty and interest as ad valorem tax amounts not paid by 
 80.13  the respective due date.  The due date for the special tax is 
 80.14  the due date for the real property tax for the property on which 
 80.15  the special tax is imposed. 
 80.16     Subd. 6.  [EFFECTIVE DATE.] This section is effective upon 
 80.17  compliance by the city of Brooklyn Center with Minnesota 
 80.18  Statutes, section 645.021, subdivision 3. 
 80.19     Sec. 13.  [CITY OF BURNSVILLE; USE OF TAX INCREMENTS.] 
 80.20     Subdivision 1.  [AUTHORIZATION.] Notwithstanding Minnesota 
 80.21  Statutes, section 469.176, 469.1763, or any other law to the 
 80.22  contrary, tax increments derived from the tax increment 
 80.23  financing district No. 2-1 in the city of Burnsville may, to the 
 80.24  extent not required for purposes of that district's tax 
 80.25  increment financing plan, be used to meet costs incurred by the 
 80.26  city or its economic development authority in relation to 
 80.27  assisting in the construction of an amphitheater and related 
 80.28  infrastructure improvements.  This section does not authorize an 
 80.29  extension of the duration of tax increment financing district No.
 80.30  2-1 beyond its duration under current law. 
 80.31     Subd. 2.  [EFFECTIVE DATE.] This section is effective upon 
 80.32  compliance by the city of Burnsville with Minnesota Statutes, 
 80.33  section 645.021, subdivision 3. 
 80.34     Sec. 14.  [CITY OF FOLEY; TAX INCREMENT FINANCING.] 
 80.35     Subdivision 1.  [AUTHORIZATION OF USE OF 
 80.36  INCREMENTS.] Notwithstanding any law to the contrary, 
 81.1   expenditures by the city of Foley before January 1, 1998, of 
 81.2   revenue derived from tax increment financing district No. 1 to 
 81.3   finance a wastewater treatment facility located outside of the 
 81.4   district are authorized expenditures of that revenue.  
 81.5      Subd. 2.  [EFFECTIVE DATE.] Pursuant to Minnesota Statutes, 
 81.6   section 645.023, subdivision 1, paragraph (a), this section is 
 81.7   effective without local approval the day following final 
 81.8   enactment and applies to revenues expended before January 1, 
 81.9   1998. 
 81.10     Sec. 15.  [CITY OF MINNEAPOLIS; LAKE STREET REDEVELOPMENT 
 81.11  DISTRICT.] 
 81.12     Subdivision 1.  [AUTHORIZATION.] Upon approval of the 
 81.13  governing body of the Minneapolis community development agency 
 81.14  by resolution, the authority may establish a redevelopment tax 
 81.15  increment financing district with phased redevelopment at a site 
 81.16  located on Lake Street and Chicago Avenue.  The district shall 
 81.17  be subject to Minnesota Statutes, sections 469.174 to 469.179, 
 81.18  except as provided in this section.  
 81.19     Subd. 2.  [ORIGINAL NET TAX CAPACITY.] Notwithstanding 
 81.20  Minnesota Statutes, section 469.174, subdivision 7, the original 
 81.21  net tax capacity of the district, as of the date the authority 
 81.22  certifies to the county auditor that the authority has entered 
 81.23  into a redevelopment or other agreement for rehabilitation of 
 81.24  the site or remediation of hazardous substances, shall be zero.  
 81.25     Subd. 3.  [DURATION OF DISTRICT.] Notwithstanding the 
 81.26  provisions of Minnesota Statutes, section 469.176, subdivision 
 81.27  1b, no tax increment shall be paid to the authority after the 
 81.28  earlier of:  (1) 18 years from the date of receipt by the 
 81.29  authority of the first increment generated from the final phase 
 81.30  of redevelopment or (2) 30 years from the date of receipt by the 
 81.31  authority of the first increment from the district.  "Final 
 81.32  phase of redevelopment" means that phase of redevelopment 
 81.33  activity which completes the rehabilitation of the Sears site.  
 81.34     Subd. 4.  [REMOVAL OF HAZARDOUS SUBSTANCES.] For purposes 
 81.35  of the three-year activity rule under Minnesota Statutes, 
 81.36  section 469.176, subdivision 1a, and the four-year action 
 82.1   requirement under Minnesota Statutes, section 469.176, 
 82.2   subdivision 6, the removal of hazardous substances from the site 
 82.3   shall constitute a qualifying activity.  
 82.4      Subd. 5.  [FIVE-YEAR RULE.] Minnesota Statutes, section 
 82.5   469.1763, subdivision 3, does not apply.  
 82.6      Subd. 6.  [NEIGHBORHOOD REVITALIZATION FUNDS.] Revenues 
 82.7   reserved by the authority for the neighborhood revitalization 
 82.8   program and allocated pursuant to the requirements of Minnesota 
 82.9   Statutes, section 469.1831, for expenditure in the tax increment 
 82.10  financing district described in this section qualify as a local 
 82.11  contribution for purposes of Minnesota Statutes, section 
 82.12  273.1399, subdivision 6. 
 82.13     Subd. 7.  [EFFECTIVE DATE.] Subdivisions 1 to 6 are 
 82.14  effective upon compliance by the governing body of the 
 82.15  Minneapolis community development agency with Minnesota 
 82.16  Statutes, section 645.021, subdivision 3.  Subdivision 6 is 
 82.17  effective for aid paid after July 1, 1998. 
 82.18     Sec. 16.  [CITY OF RENVILLE; TAX INCREMENT FINANCING 
 82.19  DISTRICT.] 
 82.20     Subdivision 1.  [CERTIFICATION DATE.] Except as otherwise 
 82.21  provided in this section, for purposes of Minnesota Statutes, 
 82.22  section 273.1399, and chapter 469, the certification date of the 
 82.23  addition of the following described property to tax increment 
 82.24  financing district No. 1 in the city of Renville is deemed to be 
 82.25  November 1, 1994:  Lots 5, 6, 7, 8, and 9, Block 32, O'Connor's 
 82.26  Addition. 
 82.27     Subd. 2.  [ORIGINAL NET TAX CAPACITY; ORIGINAL LOCAL TAX 
 82.28  RATE.] The original net tax capacity of property in subdivision 
 82.29  1 shall be $432 and the original local tax rate shall be 186.871 
 82.30  as of January 2, 1998, for increment collected in 1999. 
 82.31     Subd. 3.  [EXPENDITURE OF INCREMENT.] Notwithstanding the 
 82.32  provisions of Minnesota Statutes, section 469.176, subdivision 
 82.33  1b, the city of Renville may collect and expend tax increment 
 82.34  generated by the lots cited in subdivision 1, in tax increment 
 82.35  financing district No. 1 in the city of Renville, until December 
 82.36  31, 2007. 
 83.1      Subd. 4.  [APPLICABILITY.] The provisions of Minnesota 
 83.2   Statutes, sections 273.1399, subdivision 8, and 469.1782, do not 
 83.3   apply to the authority granted in this section. 
 83.4      Subd. 5.  [LOCAL APPROVAL.] This section is effective upon 
 83.5   compliance by the city of Renville with Minnesota Statutes, 
 83.6   section 645.021, subdivision 3. 
 83.7      Sec. 17.  [CITY OF WEST ST. PAUL; DAKOTA COUNTY HOUSING AND 
 83.8   REDEVELOPMENT AUTHORITY; EXCEPTION TO TAX INCREMENT FINANCING 
 83.9   REQUIREMENTS.] 
 83.10     Subdivision 1.  [GENERALLY.] The city of West St. Paul and 
 83.11  the Dakota county housing and redevelopment authority may 
 83.12  operate the Signal Hills Redevelopment tax increment financing 
 83.13  district (Dakota county housing and redevelopment authority tax 
 83.14  increment financing district No. 11) hereinafter referred to as 
 83.15  "the district" according to the provisions set forth in this 
 83.16  section. 
 83.17     Subd. 2.  [LOCAL CONTRIBUTION.] The district is exempt from 
 83.18  the reduction in state aid imposed under Minnesota Statutes, 
 83.19  section 273.1399, without making a contribution required under 
 83.20  Minnesota Statutes, section 273.1399, subdivision 6, paragraph 
 83.21  (d), if it contributes each year an amount equal to five percent 
 83.22  of the tax increments from the district received in that year 
 83.23  into a redevelopment account, which may be used for 
 83.24  redevelopment projects in the South Robert Street Redevelopment 
 83.25  tax increment financing district (Dakota county housing and 
 83.26  redevelopment authority tax increment financing district No. 4). 
 83.27     Subd. 3.  [TIME LIMIT FOR INITIATING ACTION.] The time 
 83.28  limits for initiation of activity in the district and reporting 
 83.29  the initiation to the county auditor under Minnesota Statutes, 
 83.30  section 469.176, subdivision 6, are extended to five and six 
 83.31  years, respectively. 
 83.32     Subd. 4.  [FIVE-YEAR RULE.] The district is subject to the 
 83.33  requirement of Minnesota Statutes, section 469.1763, subdivision 
 83.34  3, except that the five-year period is extended to a ten-year 
 83.35  period. 
 83.36     Subd. 5.  [THREE-YEAR RULE.] The district is not subject to 
 84.1   the provisions of Minnesota Statutes, section 469.176, 
 84.2   subdivision 1a. 
 84.3      Subd. 6.  [EFFECTIVE DATE.] This section is effective upon 
 84.4   compliance by the city of West St. Paul with Minnesota Statutes, 
 84.5   section 645.021, subdivision 3. 
 84.6      Sec. 18.  [EFFECTIVE DATE.] 
 84.7      Sections 1, 5, and 7 apply to tax increment financing 
 84.8   districts certified before, on, or after August 1, 1979. 
 84.9      Sections 2, 3, 4, and 8 are effective for disclosures 
 84.10  required to be made and reports required to be submitted in 1999.
 84.11     Section 6 is effective for tax increment financing 
 84.12  districts for which certification is requested after April 30, 
 84.13  1998. 
 84.14     Section 9 is effective the day following final enactment. 
 84.15     Section 10 is effective the day following final enactment 
 84.16  and applies to abatements granted on or after that date. 
 84.17     Section 11 is effective upon compliance by Itasca county 
 84.18  with Minnesota Statutes, section 645.021, subdivision 3. 
 84.19                             ARTICLE 5
 84.20                           TACONITE TAXES
 84.21     Section 1.  [298.001] [DEFINITIONS.] 
 84.22     Subdivision 1.  [GENERALLY.] As used in this chapter, the 
 84.23  terms defined in this section have the meanings given in this 
 84.24  section. 
 84.25     Subd. 2.  [CITY.] "City" includes any home rule charter 
 84.26  city, statutory city, or any city however organized. 
 84.27     Subd. 3.  [PERSON.] "Person" means individuals, 
 84.28  fiduciaries, estates, trusts, partnerships, companies, joint 
 84.29  stock companies, corporations, and all associations. 
 84.30     Subd. 4.  [TACONITE.] "Taconite" means ferruginous chert or 
 84.31  ferruginous slate in the form of compact, siliceous rock, in 
 84.32  which the iron oxide is so finely disseminated that 
 84.33  substantially all of the iron-bearing particles of merchantable 
 84.34  grade are smaller than 20 mesh and which is not merchantable as 
 84.35  iron ore in its natural state, and which cannot be made 
 84.36  merchantable by simple methods of beneficiation involving only 
 85.1   crushing, screening, washing, jigging, drying, or any 
 85.2   combination thereof. 
 85.3      Subd. 5.  [IRON SULPHIDES.] "Iron sulphides" means chemical 
 85.4   combinations of iron and sulphur (mineralogically known as 
 85.5   pyrrhotite, pyrites, or marcasite), in relatively impure 
 85.6   condition, which are not merchantable as iron ore and which 
 85.7   cannot be made merchantable by the simple methods of 
 85.8   beneficiation above described.  
 85.9      Subd. 6.  [SEMITACONITE.] "Semitaconite" means altered iron 
 85.10  formation, altered taconite, ferruginous chert, or ferruginous 
 85.11  slate which has been oxidized and partially leached and in which 
 85.12  the iron oxide is so finely disseminated that substantially all 
 85.13  of the iron-bearing particles of merchantable grade are smaller 
 85.14  than 20 mesh and which is not merchantable as iron ore in its 
 85.15  natural state, and which cannot be made merchantable by simple 
 85.16  methods of beneficiation involving only crushing, screening, 
 85.17  washing, jigging, heavy media separation, spirals, cyclones, 
 85.18  drying, or any combination thereof.  
 85.19     Subd. 7.  [AGGLOMERATES.] "Agglomerates" means the 
 85.20  merchantable iron ore aggregates which are produced by 
 85.21  agglomeration.  
 85.22     Subd. 8.  [COMMISSIONER.] "Commissioner" means the 
 85.23  commissioner of revenue of the state of Minnesota.  
 85.24     Sec. 2.  Minnesota Statutes 1996, section 298.22, 
 85.25  subdivision 2, is amended to read: 
 85.26     Subd. 2.  There is hereby created the iron range resources 
 85.27  and rehabilitation board, consisting of 11 members, five of whom 
 85.28  shall be are state senators appointed by the subcommittee on 
 85.29  committees of the rules committee of the senate, and five of 
 85.30  whom shall be are representatives, appointed by the speaker of 
 85.31  the house of representatives, their terms of office to commence 
 85.32  on May 1, 1943, and continue until January 3rd, 1945, or until 
 85.33  their successors are appointed and qualified.  Their successors 
 85.34  The members shall be appointed each two years in the same manner 
 85.35  as the original members were appointed, in January of every 
 85.36  second odd-numbered year, commencing in January, 1945.  The 11th 
 86.1   member of said the board shall be is the commissioner of natural 
 86.2   resources of the state of Minnesota.  Vacancies on the board 
 86.3   shall be filled in the same manner as the original members were 
 86.4   chosen.  At least a majority of the legislative members of the 
 86.5   board shall be elected from state senatorial or legislative 
 86.6   districts in which over 50 percent of the residents reside 
 86.7   within a tax relief area as defined in section 273.134.  All 
 86.8   expenditures and projects made by the commissioner of iron range 
 86.9   resources and rehabilitation shall first be submitted to said 
 86.10  the iron range resources and rehabilitation board for approval 
 86.11  by at least eight board members of expenditures and projects for 
 86.12  rehabilitation purposes as provided by this section, and the 
 86.13  method, manner, and time of payment of all said funds proposed 
 86.14  to be disbursed shall be first approved or disapproved by said 
 86.15  the board.  The board shall biennially make its report to the 
 86.16  governor and the legislature on or before November 15 of each 
 86.17  even-numbered year.  The expenses of said the board shall be 
 86.18  paid by the state of Minnesota from the funds raised pursuant to 
 86.19  this section. 
 86.20     Sec. 3.  Minnesota Statutes 1996, section 298.221, is 
 86.21  amended to read: 
 86.22     298.221 [RECEIPTS FROM CONTRACTS; APPROPRIATION.] 
 86.23     (a) All moneys money paid to the state of Minnesota 
 86.24  pursuant to the terms of any contract entered into by the state 
 86.25  under authority of Laws 1941, chapter 544, section 4, or of said 
 86.26  section as amended section 298.22 and any fees which may, in the 
 86.27  discretion of the commissioner of iron range resources and 
 86.28  rehabilitation, be charged in connection with any project 
 86.29  pursuant to that section as amended, shall be deposited in the 
 86.30  state treasury to the credit of the iron range resources and 
 86.31  rehabilitation board account in the special revenue fund and are 
 86.32  hereby appropriated for the purposes of section 298.22. 
 86.33     (b) Notwithstanding section 7.09, merchandise may be 
 86.34  accepted by the commissioner of the iron range resources and 
 86.35  rehabilitation board for payment of advertising contracts if the 
 86.36  commissioner determines that the merchandise can be used for 
 87.1   special event prizes or mementos at facilities operated by the 
 87.2   board.  Nothing in this paragraph authorizes the commissioner or 
 87.3   a member of the board to receive merchandise for personal use.  
 87.4      Sec. 4.  Minnesota Statutes 1996, section 298.2213, 
 87.5   subdivision 4, is amended to read: 
 87.6      Subd. 4.  [PROJECT APPROVAL.] The board shall by August 1, 
 87.7   1987, and each year thereafter prepare a list of projects to be 
 87.8   funded from the money appropriated in this section with 
 87.9   necessary supporting information including descriptions of the 
 87.10  projects, plans, and cost estimates.  A project must not be 
 87.11  approved by the board unless it finds that:  
 87.12     (1) the project will materially assist, directly or 
 87.13  indirectly, the creation of additional long-term employment 
 87.14  opportunities; 
 87.15     (2) the prospective benefits of the expenditure exceed the 
 87.16  anticipated costs; and 
 87.17     (3) in the case of assistance to private enterprise, the 
 87.18  project will serve a sound business purpose.  
 87.19     To be proposed by the board, a project must be approved by 
 87.20  at least eight iron range resources and rehabilitation board 
 87.21  members and the commissioner of iron range resources and 
 87.22  rehabilitation.  The list of projects must be submitted to the 
 87.23  governor, who shall, by November 15 of each year, approve, 
 87.24  disapprove, or return for further consideration, each project.  
 87.25  The money for a project may be spent only upon approval of the 
 87.26  project by the governor.  The board may submit supplemental 
 87.27  projects for approval at any time.  
 87.28     Sec. 5.  Minnesota Statutes 1996, section 298.225, 
 87.29  subdivision 1, is amended to read: 
 87.30     Subdivision 1.  For distribution of taconite production tax 
 87.31  in 1987 and thereafter with respect to production in 1986 and 
 87.32  thereafter, The distribution of the taconite production tax as 
 87.33  provided in section 298.28, subdivisions 2 to 5, 6, paragraphs 
 87.34  (b) and (c), 7, and 8, shall equal the lesser of the following 
 87.35  amounts:  
 87.36     (1) the amount distributed pursuant to this section and 
 88.1   section 298.28, with respect to 1983 production if the 
 88.2   production for the year prior to the distribution year is no 
 88.3   less than 42,000,000 taxable tons.  If the production is less 
 88.4   than 42,000,000 taxable tons, the amount of the distributions 
 88.5   shall be reduced proportionately at the rate of two percent for 
 88.6   each 1,000,000 tons, or part of 1,000,000 tons by which the 
 88.7   production is less than 42,000,000 tons; or 
 88.8      (2)(i) for the distributions made pursuant to section 
 88.9   298.28, subdivisions 4, paragraphs (b) and (c), and 6, paragraph 
 88.10  (c), 50 percent of the amount distributed pursuant to this 
 88.11  section and section 298.28, with respect to 1983 production.  
 88.12     (ii) for the distributions made pursuant to section 298.28, 
 88.13  subdivision 5, paragraphs (b) and (d), 75 percent of the amount 
 88.14  distributed pursuant to this section and section 298.28, with 
 88.15  respect to 1983 production.  
 88.16     Sec. 6.  Minnesota Statutes 1997 Supplement, section 
 88.17  298.24, subdivision 1, is amended to read: 
 88.18     Subdivision 1.  (a) For concentrate produced in 1992, 1993, 
 88.19  1994, and 1995 1997, there is imposed upon taconite and iron 
 88.20  sulphides, and upon the mining and quarrying thereof, and upon 
 88.21  the production of iron ore concentrate therefrom, and upon the 
 88.22  concentrate so produced, a tax of $2.054 $2.141 per gross ton of 
 88.23  merchantable iron ore concentrate produced therefrom.  
 88.24     (b) On concentrates produced in 1997 and thereafter, an 
 88.25  additional tax is imposed equal to three cents per gross ton of 
 88.26  merchantable iron ore concentrate for each one percent that the 
 88.27  iron content of the product exceeds 72 percent, when dried at 
 88.28  212 degrees Fahrenheit. 
 88.29     (c) For concentrates produced in 1996 1998 and subsequent 
 88.30  years, the tax rate shall be equal to the preceding year's tax 
 88.31  rate plus an amount equal to the preceding year's tax rate 
 88.32  multiplied by the percentage increase in the implicit price 
 88.33  deflator from the fourth quarter of the second preceding year to 
 88.34  the fourth quarter of the preceding year, provided that, for 
 88.35  concentrates produced in 1996 only, the increase in the rate of 
 88.36  tax imposed under this section over the rate imposed for the 
 89.1   previous year may not exceed four cents per ton.  "Implicit 
 89.2   price deflator" for the gross national product means the 
 89.3   implicit price deflator prepared by the bureau of economic 
 89.4   analysis of the United States Department of Commerce.  
 89.5      (c) On concentrates produced in 1997 and thereafter, an 
 89.6   additional tax is imposed equal to three cents per gross ton of 
 89.7   merchantable iron ore concentrate for each one percent that the 
 89.8   iron content of the product exceeds 72 percent, when dried at 
 89.9   212 degrees Fahrenheit. 
 89.10     (d) The tax shall be imposed on the average of the 
 89.11  production for the current year and the previous two years.  The 
 89.12  rate of the tax imposed will be the current year's tax rate.  
 89.13  This clause shall not apply in the case of the closing of a 
 89.14  taconite facility if the property taxes on the facility would be 
 89.15  higher if this clause and section 298.25 were not applicable.  
 89.16     (e) If the tax or any part of the tax imposed by this 
 89.17  subdivision is held to be unconstitutional, a tax 
 89.18  of $2.054 $2.141 per gross ton of merchantable iron ore 
 89.19  concentrate produced shall be imposed.  
 89.20     (f) Consistent with the intent of this subdivision to 
 89.21  impose a tax based upon the weight of merchantable iron ore 
 89.22  concentrate, the commissioner of revenue may indirectly 
 89.23  determine the weight of merchantable iron ore concentrate 
 89.24  included in fluxed pellets by subtracting the weight of the 
 89.25  limestone, dolomite, or olivine derivatives or other basic flux 
 89.26  additives included in the pellets from the weight of the 
 89.27  pellets.  For purposes of this paragraph, "fluxed pellets" are 
 89.28  pellets produced in a process in which limestone, dolomite, 
 89.29  olivine, or other basic flux additives are combined with 
 89.30  merchantable iron ore concentrate.  No subtraction from the 
 89.31  weight of the pellets shall be allowed for binders, mineral and 
 89.32  chemical additives other than basic flux additives, or moisture. 
 89.33     (g)(1) Notwithstanding any other provision of this 
 89.34  subdivision, for the first two years of a plant's production of 
 89.35  direct reduced ore, no tax is imposed under this section.  As 
 89.36  used in this paragraph, "direct reduced ore" is ore that results 
 90.1   in a product that has an iron content of at least 75 percent.  
 90.2   For the third year of a plant's production of direct reduced 
 90.3   ore, the rate to be applied to direct reduced ore is 25 percent 
 90.4   of the rate otherwise determined under this subdivision.  For 
 90.5   the fourth such production year, the rate is 50 percent of the 
 90.6   rate otherwise determined under this subdivision; for the fifth 
 90.7   such production year, the rate is 75 percent of the rate 
 90.8   otherwise determined under this subdivision; and for all 
 90.9   subsequent production years, the full rate is imposed. 
 90.10     (2) Subject to clause (1), production of direct reduced ore 
 90.11  in this state is subject to the tax imposed by this section, but 
 90.12  if that production is not produced by a producer of taconite or 
 90.13  iron sulfides, the production of taconite or iron sulfides 
 90.14  consumed in the production of direct reduced iron in this state 
 90.15  is not subject to the tax imposed by this section on taconite or 
 90.16  iron sulfides. 
 90.17     Sec. 7.  Minnesota Statutes 1996, section 298.28, 
 90.18  subdivision 2, is amended to read: 
 90.19     Subd. 2.  [CITY OR TOWN WHERE QUARRIED OR PRODUCED.] (a) 
 90.20  4.5 cents per gross ton of merchantable iron ore concentrate, 
 90.21  hereinafter referred to as "taxable ton," must be allocated to 
 90.22  the city or town in the county in which the lands from which 
 90.23  taconite was mined or quarried were located or within which the 
 90.24  concentrate was produced.  If the mining, quarrying, and 
 90.25  concentration, or different steps in either thereof are carried 
 90.26  on in more than one taxing district, the commissioner shall 
 90.27  apportion equitably the proceeds of the part of the tax going to 
 90.28  cities and towns among such subdivisions upon the basis of 
 90.29  attributing 40 percent of the proceeds of the tax to the 
 90.30  operation of mining or quarrying the taconite, and the remainder 
 90.31  to the concentrating plant and to the processes of 
 90.32  concentration, and with respect to each thereof giving due 
 90.33  consideration to the relative extent of such operations 
 90.34  performed in each such taxing district.  The commissioner's 
 90.35  order making such apportionment shall be subject to review by 
 90.36  the tax court at the instance of any of the interested taxing 
 91.1   districts, in the same manner as other orders of the 
 91.2   commissioner. 
 91.3      (b) Four cents per taxable ton shall be allocated to cities 
 91.4   and organized townships affected by mining because their 
 91.5   boundaries are within two miles of a taconite mine pit that has 
 91.6   been actively mined in at least one of the prior three years.  
 91.7   If a city or town is located near more than one mine meeting 
 91.8   these criteria, the city or town is eligible to receive aid 
 91.9   calculated from only the mine producing the largest taxable 
 91.10  tonnage.  When more than one municipality qualifies for aid 
 91.11  based on one company's production, the aid must be apportioned 
 91.12  among the municipalities in proportion to their populations.  Of 
 91.13  the amounts distributed under this paragraph to each 
 91.14  municipality, one-half must be used for infrastructure 
 91.15  improvement projects, and one-half must be used for projects in 
 91.16  which two or more municipalities cooperate.  Each municipality 
 91.17  that receives a distribution under this paragraph must report 
 91.18  annually to the iron range resources and rehabilitation board 
 91.19  and the commissioner of iron range resources and rehabilitation 
 91.20  on the projects involving cooperation with other municipalities. 
 91.21     Sec. 8.  Minnesota Statutes 1996, section 298.28, 
 91.22  subdivision 3, is amended to read: 
 91.23     Subd. 3.  [CITIES; TOWNS.] (a) 12.5 cents per taxable ton, 
 91.24  less any amount distributed under subdivision 8, and paragraph 
 91.25  (b), must be allocated to the taconite municipal aid account to 
 91.26  be distributed as provided in section 298.282. 
 91.27     (b) An amount must be allocated to towns or cities that is 
 91.28  annually certified by the county auditor of a county containing 
 91.29  a taconite tax relief area within which there is (1) an 
 91.30  organized township if, as of January 2, 1982, more than 75 
 91.31  percent of the assessed valuation of the township consists of 
 91.32  iron ore or (2) a city if, as of January 2, 1980, more than 75 
 91.33  percent of the assessed valuation of the city consists of iron 
 91.34  ore.  
 91.35     (c) The amount allocated under paragraph (b) will be the 
 91.36  portion of a township's or city's certified levy equal to the 
 92.1   proportion of (1) the difference between 50 percent of January 
 92.2   2, 1982, assessed value in the case of a township and 50 percent 
 92.3   of the January 2, 1980, assessed value in the case of a city and 
 92.4   its current assessed value to (2) the sum of its current 
 92.5   assessed value plus the difference determined in (1), provided 
 92.6   that the amount distributed shall not exceed $55 per capita in 
 92.7   the case of a township or $75 per capita in the case of a city.  
 92.8   For purposes of this limitation, population will be determined 
 92.9   according to the 1980 decennial census conducted by the United 
 92.10  States Bureau of the Census.  If the current assessed value of 
 92.11  the township exceeds 50 percent of the township's January 2, 
 92.12  1982, assessed value, or if the current assessed value of the 
 92.13  city exceeds 50 percent of the city's January 2, 1980, assessed 
 92.14  value, this paragraph shall not apply.  For purposes of this 
 92.15  paragraph, "assessed value," when used in reference to years 
 92.16  other than 1980 or 1982, means, for distributions for production 
 92.17  year 1989, production taxes payable in 1990, the appropriate net 
 92.18  tax capacities multiplied by 8.2 and for distributions for 
 92.19  production year 1990 and thereafter, production taxes payable in 
 92.20  1991 and thereafter, the appropriate net tax capacities 
 92.21  multiplied by 10.2. 
 92.22     Sec. 9.  Minnesota Statutes 1996, section 298.28, 
 92.23  subdivision 4, is amended to read: 
 92.24     Subd. 4.  [SCHOOL DISTRICTS.] (a) 27.5 cents per taxable 
 92.25  ton plus the increase provided in paragraph (d) must be 
 92.26  allocated to qualifying school districts to be distributed, 
 92.27  based upon the certification of the commissioner of revenue, 
 92.28  under paragraphs (b) and (c). 
 92.29     (b) 5.5 cents per taxable ton must be distributed to the 
 92.30  school districts in which the lands from which taconite was 
 92.31  mined or quarried were located or within which the concentrate 
 92.32  was produced.  The distribution must be based on the 
 92.33  apportionment formula prescribed in subdivision 2. 
 92.34     (c)(i) 22 cents per taxable ton, less any amount 
 92.35  distributed under paragraph (e), shall be distributed to a group 
 92.36  of school districts comprised of those school districts in which 
 93.1   the taconite was mined or quarried or the concentrate produced 
 93.2   or in which there is a qualifying municipality as defined by 
 93.3   section 273.134 in direct proportion to school district indexes 
 93.4   as follows:  for each school district, its pupil units 
 93.5   determined under section 124.17 for the prior school year shall 
 93.6   be multiplied by the ratio of the average adjusted net tax 
 93.7   capacity per pupil unit for school districts receiving aid under 
 93.8   this clause as calculated pursuant to chapter 124A for the 
 93.9   school year ending prior to distribution to the adjusted net tax 
 93.10  capacity per pupil unit of the district.  Each district shall 
 93.11  receive that portion of the distribution which its index bears 
 93.12  to the sum of the indices for all school districts that receive 
 93.13  the distributions.  
 93.14     (ii) Notwithstanding clause (i), each school district that 
 93.15  receives a distribution under sections 298.018; 298.23 to 
 93.16  298.28, exclusive of any amount received under this clause; 
 93.17  298.34 to 298.39; 298.391 to 298.396; 298.405; or any law 
 93.18  imposing a tax on severed mineral values that is less than the 
 93.19  amount of its levy reduction under section 124.918, subdivision 
 93.20  8, for the second year prior to the year of the distribution 
 93.21  shall receive a distribution equal to the difference; the amount 
 93.22  necessary to make this payment shall be derived from 
 93.23  proportionate reductions in the initial distribution to other 
 93.24  school districts under clause (i).  
 93.25     (d) Any school district described in paragraph (c) where a 
 93.26  levy increase pursuant to section 124A.03, subdivision 2, is 
 93.27  authorized by referendum, shall receive a distribution according 
 93.28  to the following formula.  In 1994, the amount distributed per 
 93.29  ton shall be equal to the amount per ton distributed in 1991 
 93.30  under this paragraph increased in the same proportion as the 
 93.31  increase between the fourth quarter of 1989 and the fourth 
 93.32  quarter of 1992 in the implicit price deflator as defined in 
 93.33  section 298.24, subdivision 1 from a fund that receives a 
 93.34  distribution in 1998 of 21.3 cents per ton.  On July 15, 1995, 
 93.35  and subsequent years of 1999, and each year thereafter, the 
 93.36  increase over the amount established for the prior year shall be 
 94.1   determined according to the increase in the implicit price 
 94.2   deflator as provided in section 298.24, subdivision 1.  Each 
 94.3   district shall receive the product of: 
 94.4      (i) $175 times the pupil units identified in section 
 94.5   124.17, subdivision 1, enrolled in the second previous year or 
 94.6   the 1983-1984 school year, whichever is greater, less the 
 94.7   product of 1.8 percent times the district's taxable net tax 
 94.8   capacity in the second previous year; times 
 94.9      (ii) the lesser of: 
 94.10     (A) one, or 
 94.11     (B) the ratio of the sum of the amount certified pursuant 
 94.12  to section 124A.03, subdivision 1g, in the previous year, plus 
 94.13  the amount certified pursuant to section 124A.03, subdivision 
 94.14  1i, in the previous year, plus the referendum aid according to 
 94.15  section 124A.03, subdivision 1h, for the current year, plus an 
 94.16  amount equal to the reduction under section 124A.03, subdivision 
 94.17  3b, to the product of 1.8 percent times the district's taxable 
 94.18  net tax capacity in the second previous year. 
 94.19     If the total amount provided by paragraph (d) is 
 94.20  insufficient to make the payments herein required then the 
 94.21  entitlement of $175 per pupil unit shall be reduced uniformly so 
 94.22  as not to exceed the funds available.  Any amounts received by a 
 94.23  qualifying school district in any fiscal year pursuant to 
 94.24  paragraph (d) shall not be applied to reduce general education 
 94.25  aid which the district receives pursuant to section 124A.23 or 
 94.26  the permissible levies of the district.  Any amount remaining 
 94.27  after the payments provided in this paragraph shall be paid to 
 94.28  the commissioner of iron range resources and rehabilitation who 
 94.29  shall deposit the same in the taconite environmental protection 
 94.30  fund and the northeast Minnesota economic protection trust fund 
 94.31  as provided in subdivision 11. 
 94.32     Each district receiving money according to this paragraph 
 94.33  shall reserve $25 times the number of pupil units in the 
 94.34  district.  It may use the money for early childhood programs or 
 94.35  for outcome-based learning programs that enhance the academic 
 94.36  quality of the district's curriculum.  The outcome-based 
 95.1   learning programs must be approved by the commissioner of 
 95.2   children, families, and learning. 
 95.3      (e) There shall be distributed to any school district the 
 95.4   amount which the school district was entitled to receive under 
 95.5   section 298.32 in 1975. 
 95.6      Sec. 10.  Minnesota Statutes 1996, section 298.28, 
 95.7   subdivision 6, is amended to read: 
 95.8      Subd. 6.  [PROPERTY TAX RELIEF.] (a) Fifteen 32.6 cents per 
 95.9   taxable ton, less any amount required to be distributed under 
 95.10  paragraphs (b) and (c), and less any amount required to be 
 95.11  deducted under paragraph (d), must be allocated to St. Louis 
 95.12  county acting as the counties' fiscal agent, to be distributed 
 95.13  as provided in sections 273.134 to 273.136. 
 95.14     (b) If an electric power plant owned by and providing the 
 95.15  primary source of power for a taxpayer mining and concentrating 
 95.16  taconite is located in a county other than the county in which 
 95.17  the mining and the concentrating processes are conducted, .1875 
 95.18  cent per taxable ton of the tax imposed and collected from such 
 95.19  taxpayer shall be paid to the county. 
 95.20     (c) If an electric power plant owned by and providing the 
 95.21  primary source of power for a taxpayer mining and concentrating 
 95.22  taconite is located in a school district other than a school 
 95.23  district in which the mining and concentrating processes are 
 95.24  conducted, .5625 cent per taxable ton of the tax imposed and 
 95.25  collected from the taxpayer shall be paid to the school district.
 95.26     (d) Two cents per taxable ton must be deducted from the 
 95.27  amount allocated to the St. Louis county auditor under paragraph 
 95.28  (a). 
 95.29     Sec. 11.  Minnesota Statutes 1996, section 298.28, 
 95.30  subdivision 7, is amended to read: 
 95.31     Subd. 7.  [IRON RANGE RESOURCES AND REHABILITATION BOARD.] 
 95.32  Three For the 1998 distribution, 6.5 cents per taxable ton shall 
 95.33  be paid to the iron range resources and rehabilitation board for 
 95.34  the purposes of section 298.22.  The amount determined in this 
 95.35  subdivision shall be increased in 1981 and subsequent years 
 95.36  prior to 1988 in the same proportion as the increase in the 
 96.1   steel mill products index as provided in section 298.24, 
 96.2   subdivision 1, and shall be increased in 1989, 1990, and 1991 
 96.3   according to the increase in the implicit price deflator as 
 96.4   provided in section 298.24, subdivision 1.  In 1992 and 1993, 
 96.5   the amount distributed per ton shall be the same as the amount 
 96.6   distributed per ton in 1991.  In 1994, the amount distributed 
 96.7   shall be the distribution per ton for 1991 increased in the same 
 96.8   proportion as the increase between the fourth quarter of 1989 
 96.9   and the fourth quarter of 1992 in the implicit price deflator as 
 96.10  defined in section 298.24, subdivision 1.  That amount shall be 
 96.11  increased in 1995 1999 and subsequent years in the same 
 96.12  proportion as the increase in the implicit price deflator as 
 96.13  provided in section 298.24, subdivision 1.  The amount 
 96.14  distributed in 1988 shall be increased according to the increase 
 96.15  that would have occurred in the rate of tax under section 298.24 
 96.16  if the rate had been adjusted according to the implicit price 
 96.17  deflator for 1987 production.  The amount distributed pursuant 
 96.18  to this subdivision shall be expended within or for the benefit 
 96.19  of a tax relief area defined in section 273.134.  No part of the 
 96.20  fund provided in this subdivision may be used to provide loans 
 96.21  for the operation of private business unless the loan is 
 96.22  approved by the governor. 
 96.23     Sec. 12.  Minnesota Statutes 1996, section 298.28, 
 96.24  subdivision 9, is amended to read: 
 96.25     Subd. 9.  [MINNESOTA ECONOMIC PROTECTION TRUST FUND.] 
 96.26  1.5 3.3 cents per taxable ton shall be paid to the northeast 
 96.27  Minnesota economic protection trust fund.  
 96.28     Sec. 13.  Minnesota Statutes 1997 Supplement, section 
 96.29  298.28, subdivision 9a, is amended to read: 
 96.30     Subd. 9a.  [TACONITE ECONOMIC DEVELOPMENT FUND.] (a) 15.4 
 96.31  cents per ton for distributions in 1996, 1998, and 1999, and 
 96.32  2000 and 20.4 cents per ton for distributions in 1997 shall be 
 96.33  paid to the taconite economic development fund.  No distribution 
 96.34  shall be made under this paragraph in any year in which total 
 96.35  industry production falls below 30 million tons. 
 96.36     (b) An amount equal to 50 percent of the tax under section 
 97.1   298.24 for concentrate sold in the form of pellet chips and 
 97.2   fines not exceeding 5/16 inch in size and not including crushed 
 97.3   pellets shall be paid to the taconite economic development 
 97.4   fund.  The amount paid shall not exceed $700,000 annually for 
 97.5   all companies.  If the initial amount to be paid to the fund 
 97.6   exceeds this amount, each company's payment shall be prorated so 
 97.7   the total does not exceed $700,000. 
 97.8      Sec. 14.  Minnesota Statutes 1997 Supplement, section 
 97.9   298.28, subdivision 9b, is amended to read: 
 97.10     Subd. 9b.  [TACONITE ENVIRONMENTAL FUND.] Five cents per 
 97.11  ton for distributions in 1998 and 1999, and 2000 shall be paid 
 97.12  to the taconite environmental fund for use under section 
 97.13  298.2961.  No distribution may be made under this paragraph in 
 97.14  any year in which total industry production falls below 
 97.15  30,000,000 tons. 
 97.16     Sec. 15.  Minnesota Statutes 1996, section 298.28, 
 97.17  subdivision 10, is amended to read: 
 97.18     Subd. 10.  [INCREASE.] The amounts determined under 
 97.19  subdivisions subdivision 6, paragraph (a), and subdivision 9 
 97.20  shall be increased in 1979 and subsequent years prior to 1988 in 
 97.21  the same proportion as the increase in the steel mill products 
 97.22  index as provided in section 298.24, subdivision 1.  The amount 
 97.23  distributed in 1988 shall be increased according to the increase 
 97.24  that would have occurred in the rate of tax under section 298.24 
 97.25  if the rate had been adjusted according to the implicit price 
 97.26  deflator for 1987 production.  Those amounts shall be increased 
 97.27  in 1989, 1990, and 1991 in the same proportion as the increase 
 97.28  in the implicit price deflator as provided in section 298.24, 
 97.29  subdivision 1.  In 1992 and 1993, the amounts determined under 
 97.30  subdivisions 6, paragraph (a), and 9, shall be the distribution 
 97.31  per ton determined for distribution in 1991.  In 1994, the 
 97.32  amounts determined under subdivisions 6, paragraph (a), and 9, 
 97.33  shall be the distribution per ton determined for distribution in 
 97.34  1991 increased in the same proportion as the increase between 
 97.35  the fourth quarter of 1989 and the fourth quarter of 1992 in the 
 97.36  implicit price deflator as defined in section 298.24, 
 98.1   subdivision 1.  Those amounts shall be increased in 1995 for 
 98.2   distributions based on the 1998 production year and subsequent 
 98.3   years in the same proportion as the increase in the implicit 
 98.4   price deflator as provided in section 298.24, subdivision 1.  
 98.5      The distributions per ton determined under subdivisions 5, 
 98.6   paragraphs (b) and (d), and 6, paragraphs (b) and (c) for 
 98.7   distribution in 1988 and subsequent years shall be the 
 98.8   distribution per ton determined for distribution in 1987. 
 98.9      Sec. 16.  Minnesota Statutes 1997 Supplement, section 
 98.10  298.296, subdivision 4, is amended to read: 
 98.11     Subd. 4.  [TEMPORARY LOAN AUTHORITY.] (a) The board may 
 98.12  recommend that up to $7,500,000 from the corpus of the trust may 
 98.13  be used for loans as provided in this subdivision.  The money 
 98.14  would be available for loans for construction and equipping of 
 98.15  facilities constituting (1) a value added iron products plant, 
 98.16  which may be either a new plant or a facility incorporated into 
 98.17  an existing plant that produces iron upgraded to a minimum of 75 
 98.18  percent iron content or any iron alloy with a total minimum 
 98.19  metallic content of 90 percent; or (2) a new mine or minerals 
 98.20  processing plant for any mineral subject to the net proceeds tax 
 98.21  imposed under section 298.015.  A loan under this paragraph may 
 98.22  not exceed $5,000,000 for any facility.  
 98.23     (b) Additionally, the board must reserve the first 
 98.24  $2,000,000 of the net interest, dividends, and earnings arising 
 98.25  from the investment of the trust after June 30, 1996, to be used 
 98.26  for additional grants for the purposes set forth in paragraph 
 98.27  (a).  This amount must be reserved until it is used for the 
 98.28  grants or until June 30, 1998 1999, whichever is earlier. 
 98.29     (c) Additionally, the board may recommend that up to 
 98.30  $5,500,000 from the corpus of the trust may be used for 
 98.31  additional grants for the purposes set forth in paragraph (a). 
 98.32     (d) The board may require that it receive an equity 
 98.33  percentage in any project to which it contributes under this 
 98.34  section. 
 98.35     (e) The authority to make loans and grants under this 
 98.36  subdivision terminates June 30, 1998 1999. 
 99.1      Sec. 17.  Minnesota Statutes 1996, section 298.48, 
 99.2   subdivision 1, is amended to read: 
 99.3      Subdivision 1.  [ANNUAL FILING.] By April 1 each year, 
 99.4   every owner or lessee of mineral rights who, in respect thereto, 
 99.5   has engaged in any exploration for or mining of taconite, 
 99.6   semitaconite, or iron-sulphide shall, within six months of June 
 99.7   3, 1977, file with the commissioner of revenue all data of the 
 99.8   following kinds in the possession or under the control of the 
 99.9   owner or lessee which was acquired prior to January 1, 1977 
 99.10  during the preceding calendar year: 
 99.11     (a) Maps and other records indicating the location, 
 99.12  character and extent of exploration for taconite, semitaconite, 
 99.13  or iron-sulphides; 
 99.14     (b) Logs, notes and other records indicating the nature of 
 99.15  minerals encountered during the course of exploration; 
 99.16     (c) The results of any analyses of metallurgical tests or 
 99.17  samples taken in connection with exploration; 
 99.18     (d) The ultimate pit layout and the supporting cross 
 99.19  sections; and 
 99.20     (e) Any other data which the commissioner of revenue may 
 99.21  determine to be relevant to the determination of the location, 
 99.22  nature, extent, quality or quantity of unmined ores of said 
 99.23  minerals.  The commissioner of revenue shall have the power to 
 99.24  may compel submission of the data.  The court administrator of 
 99.25  any court of record, upon demand of the commissioner, shall 
 99.26  issue a subpoena for the production of any data before the 
 99.27  commissioner.  Disobedience of subpoenas issued under this 
 99.28  section shall be punished by the district court of the district 
 99.29  in which the subpoena is issued as for a contempt of the 
 99.30  district court.  By April 1 of each succeeding year every owner 
 99.31  or lessee of mineral rights shall file with the commissioner of 
 99.32  revenue all such data acquired during the preceding calendar 
 99.33  year. 
 99.34     Sec. 18.  [USE OF PRODUCTION TAX PROCEEDS.] 
 99.35     Of the amount distributed to the iron range resources and 
 99.36  rehabilitation board under Minnesota Statutes, section 298.28, 
100.1   subdivision 7, an amount equal to the amount distributed under 
100.2   Laws 1997, chapter 231, article 8, section 16, shall be used by 
100.3   the board to make equal grants to the cities of Chisholm and 
100.4   Hibbing to be used for the establishment of an industrial park 
100.5   located at the Hibbing-Chisholm airport. 
100.6      Sec. 19.  [REPEALER.] 
100.7      Minnesota Statutes 1996, sections 298.012; 298.21; 298.23; 
100.8   298.34, subdivisions 1 and 4; and 298.391, subdivisions 2 and 5, 
100.9   are repealed. 
100.10     Sec. 20.  [EFFECTIVE DATE.] 
100.11     Section 7 is effective for distributions in 2000 and 
100.12  subsequent years. 
100.13                             ARTICLE 6
100.14                           MISCELLANEOUS
100.15     Section 1.  Minnesota Statutes 1997 Supplement, section 
100.16  270.60, subdivision 4, is amended to read: 
100.17     Subd. 4.  [PAYMENTS TO COUNTIES.] (a) The commissioner 
100.18  shall pay to a qualified county in which an Indian gaming casino 
100.19  is located ten percent of the state share of all taxes generated 
100.20  from activities on reservations and collected under a tax 
100.21  agreement under this section with the tribal government for the 
100.22  reservation located in the county.  If the tribe has casinos 
100.23  located in more than one county, the payment must be divided 
100.24  equally among the counties in which the casinos are located. 
100.25     (b) A county qualifies for payments under this subdivision 
100.26  only if one of the following conditions is met: 
100.27     (1) the county's per capita income is less than 80 percent 
100.28  of the state per capita personal income, based on the most 
100.29  recent estimates made by the United States Bureau of Economic 
100.30  Analysis; or 
100.31     (2) 30 percent or more of the total market value of real 
100.32  property in the county is exempt from ad valorem taxation.  For 
100.33  purposes of this subdivision, property exempt from ad valorem 
100.34  taxation is the property listed, valued, or assessed under 
100.35  section 273.18, paragraphs (a) and (b).  In making the initial 
100.36  determination of eligibility under this subdivision, the 
101.1   commissioner shall use taxable and exempt market values 
101.2   determined for the 1998 assessment.  That determination of 
101.3   eligibility remains in force until a new listing, valuation, or 
101.4   assessment is made pursuant to section 273.18.  In the first 
101.5   year following any new listing, valuation, and assessment made 
101.6   pursuant to section 273.18, the commissioner shall make a new 
101.7   determination of eligibility based on the most current market 
101.8   values available.  The new determination of eligibility shall be 
101.9   used to determine if a county qualifies for payments beginning 
101.10  with payments required to be made in the year of the 
101.11  determination of eligibility and shall continue in force until a 
101.12  new determination of eligibility is made. 
101.13     (c) The commissioner shall make the payments required under 
101.14  this subdivision by February 28 of the year following the year 
101.15  the taxes are collected. 
101.16     (d) An amount sufficient to make the payments authorized by 
101.17  this subdivision, not to exceed $1,100,000 in any fiscal year, 
101.18  is annually appropriated from the general fund to the 
101.19  commissioner.  If the authorized payments exceed the amount of 
101.20  the appropriation, the commissioner shall proportionately reduce 
101.21  the rate so that the total amount equals the appropriation. 
101.22     Sec. 2.  [EFFECTIVE DATE.] 
101.23     Section 1 is effective beginning with payments required to 
101.24  be made in 1999.